Opec monthly oil market report May 2013
The OPEC Reference Basket dropped for the second-consecutive month in April, declining by $5.39 or more than 5% to stand at $101.05/b. Year-to-date, the Basket declined by $10.22 or 8.7% from the same period last year. Crude oil futures took a substantial hit again in April, with Brent falling 5.6% to July 2012 levels with a monthly average of around $103/b. Nymex WTI edged 1% lower to average $92/b. A vulnerable global economy combined with the prospect of moderate demand growth, rising crude production, and high stocks sent prices tumbling. Crude oil also lost ground amid cross-commodity and equity market herd behaviour as momentum trading led to a selloff that sent commodities, such as gold and silver, plunging by record levels. The latest CFTC and ICE commitment of traders’ reports confirmed the bearish investor sentiment towards oil in April.
However, the Basket has shown some improvement since the start of the month to stand at $101.67/b on 9 May.
OPEC Member Countries
At first glance, last year was one of robust growth for OPEC Member Countries.
Growth averaged about 5.3% in 2012 and is expected to continue at a somewhat slower pace in 2013 at around 4.2%. However, total growth last year was distorted by an exceptionally strong recovery in Libya, which experienced an 80% y-o-y GDP expansion. This is forecast to slow down to 15% this year. If figures for Libya are removed, OPEC would post an increase in GDP of 3.8% this year, almost in line with the previous year’s healthy growth of 3.9%.
Saudi Arabia’s economy will see a drop in growth from 6.8% in 2012 to 5.2% in 2013 due to a decline in gross fixed capital formation, a trend that started in the fourth quarter of 2012. The UAE economy will also see a slightly lower growth rate of 3.2% this year compared with 4.0% in 2012. Kuwait is forecast to see a drop in growth from 5.2% in 2012 to 4.7% this year, and Qatar’s expansion will decrease from 6.2% in 2012 to 5.2% in 2013. Iraq will continue to expand at 8.3% this year, almost the same level as last year’s growth of 8.5%.
Africa’s oil supply is forecast to increase by 70 tb/d to average 2.38 mb/d in 2013,representing an upward revision of 15 tb/d from the previous MOMR. This revision has come from South Sudan and Sudan and Ghana, while the supply outlook for Gabon experienced a downward revision and the other producers forecast remains steady from a month earlier.
Full report: Opec monthly oil market report