Record Demand Growth Forecast Drives Oil Prices Higher

2023-08-11 19:31:57
Closing price: Oil prices rose on Friday, signing their seventh consecutive week of increases, after new forecasts for growth in global demand for crude by the IEA. Brent BRENT Brent or North Sea crude is a variation of crude oil serving as a benchmark in Europe, listed on the InterContinentalExchange (ICE), a stock exchange specializing in energy trading. It has become the first international standard for setting oil prices. from the North Sea, for October delivery, gained 0.47% to $86.81.

Its American equivalent, the barrel of West Texas Intermediate (WTI WTI West Texas Intermediate (WTI), also known as Texas Light Sweet, is a variation of crude oil that serves as a standard in pricing crude oil and as a commodity for oil futures contracts with the Nymex (New York Mercantile Exchange). ), the stock exchange specializing in energy.), for September delivery, was up 0.44% at $83.19.

The International Energy Agency (IEA) has raised its forecast for global oil demand growth in 2023, which is heading towards its “highest level on record” to reach 102.2 million barrels. per day, according to its monthly report released on Friday.

“It was a bit of a surprise as the previous OPEC report maintained around the same level of demand, but the IEA was very positive announcing record demand driven in particular by the needs of the Chinese petrochemical industry,” commented Matt Smith of Kpler.

He notes that oil prices have risen despite the strength of the dollar, supported by a bout of renewed inflation on the side of wholesale prices in the United States.

“Not only does the IEA highlight the strong demand, but it highlights the reduction in supply, in particular the production cuts decided by Saudi Arabia,” noted Matt Smith, interviewed by AFP.

Nine members of OPEC +, including its two heavyweights Ryad and Moscow, have introduced voluntary production cuts since May for a total of 1.6 million barrels / day. Cuts subsequently extended until the end of 2024.

At the same time, Saudi Arabia opted for a new production cut of one million barrels/day for July, extended until August, then until September.

Moscow had for its part committed to lowering its exports by 500,000 barrels/day in August, then by 300,000 barrels/day in September.

“If the courses of WTI WTI West Texas Intermediate (WTI), also known as Texas Light Sweet, is a variation of crude oil that serves as a standard in pricing crude oil and as a commodity for oil futures contracts with the Nymex (New York Mercantile Exchange). ), the stock exchange specializing in energy. — which this week reached their high of the year reached in April — hold at this level, it could form a new low to go higher”, warned the Kpler analyst.

On the natural gas side, the Dutch TTF futures contract, considered the European benchmark, fell slightly to 35.90 euros per megawatt hour (MWh).

For analysts at Energi Danmark, this is a “clear correction following the price surge” of more than 28% on Wednesday, caused by the potential strike of Australian workers on offshore liquefied natural gas platforms ( LNG) in the West of the country.

The Australian gas facilities affected by the potential strike alone supply more than 10% of the world’s LNG supply each month.