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In its September – October 2013 Update, the U.S. Energy Information Administration (EIA) estimated that global liquid fuels1 consumption outpaced supply in September and October 2013, resulting in a 0.3-million-barrel-per-day (bbl/d) average withdrawal in global oil stocks ,which is lower than the average 0.5-million-bbl/d stock draw during July and August.

Prices fell modestly in September and October relative to the prior 60-day period, reflecting lower consumption coupled with an increase in surplus production capacity.

The Brent front month futures price averaged about $108 per barrel for the five-trading-day period ending October 29, a decrease of about $3 per barrel compared with the five-trading-day average ending August 27.

The front month futures price for West Texas Intermediate (WTI) settled at an average of $98 per barrel for the five-days ending on October 29, a decline of about $8 per barrel since the five-day period ending August 27. In September and October 2013, Brent averaged slightly higher than $110 per barrel, nearly $2 per barrel lower than in the September-October period last year.

Global liquid fuels consumption during September and October averaged 0.5 million bbl/d lower than its average during the previous 60-day period, which is consistent with the seasonal pattern marked by both the end of the U.S. driving season and the easing of oil use for electricity generation in the Middle East.

Global liquid fuels supply during September and October was 0.3 million bbl/d lower than the average during the previous 60-day period. The decrease in world oil supply compared with the previous 60-day period reflects a 0.8-million-bbl/d decline in total production from members of the Organization of the Petroleum Exporting Countries (OPEC), namely Iraq, Libya, and Saudi Arabia.

Crude oil output declines from Iraq and Libya reflect unplanned supply disruptions, while cutbacks to Saudi Arabia’s production were primarily because of reduced direct burn of crude oil for power generation. Non-OPEC liquid fuels production increased by 0.5 million bbl/d over the previous 60-day period but was more than offset by the decrease in total OPEC output.

Global surplus crude oil production capacity in September and October 2013 averaged 1.8 million bbl/d, which is 0.2 million bbl/d above the average during the previous 60-day period but still 0.3 million bbl/d below the year-ago level. The estimate of effective surplus capacity does not include additional capacity that may be technically available in Iran, but which is offline due to the impacts of U.S. and European Union (EU) sanctions on Iran’s ability to sell its oil.

The total volume of production that is offline due to unplanned outages in OPEC and non-OPEC countries is estimated to be 2.9 million bbl/d in both September and October, virtually unchanged from the average during the previous 60-day period.

Global disruptions were mainly driven by higher outages among OPEC producers in September and higher non-OPEC outages in October.

OPEC crude oil supply disruptions reached 2.3 million bbl/d in September, the highest level since at least January 2009 from when EIA has tracked OPEC disruptions, and remained close to that level in October.

Non-OPEC outages fell in September for the second consecutive month, but increased in October because of new outages in the United States, Brazil, Canada, and Colombia. EIA estimates that unplanned disruptions averaged 0.6 million bbl/d among non-OPEC producers and 2.3 million bbl/d among OPEC members for September and October.