Crude prices 2016: What lies ahead?

Crude Oil Prices 2016, What lies ahead? argus argusmedia.com 2015 saw global production outstripping demand and prices continuing to fall as US output ramped up further and Opec maintained a Saudi-led campaign to defend market share. US LIGHT CRUDE IMF PREDICTS GDP GROWTH RUSSIAN OUTPUT STABLE OUTPUT FALL IN UK, EURO, US, JAPAN Set to remain stable at Modest growth expected in 10.66mn b/d but could decline in 2017 according to the Russian government. IEA forecasts predict a fall of 600,000 b/d. It also says non Opec production will fall by the same amount - the biggest drop for two decades. the advanced economies. Only a slight increase in emerging markets. OPEC MEETS JUNE 2 CHINESE DEMAND GROWTH No hard landing for China in 2015 and growth in demand looks likely to continue this year. LIFT OF THE NEAR BAN The effect of a resurgent ON US CRUDE EXPORTS A tighter relationship Iran and the non-OPEC slowdown will be evident by June. Both may bring a change to between US and intn'l crude prices likely. Saudi Arabia's current market share strategy. EL NIÑO LIBYA OUTPUT REBUILD IRAN OUTPUT UP Despite market scepticism Tehran says it will rebuild production Warmer weather due to After a turbulent time for the El Niño weather system means 2016 is unlikely to see a winter demand surge like the country a new political agreement could finally help production out of the doldrums. to 4mn b/d. early 2015. IEA PREDICTS GLOBAL IRAQ/KURDISTAN OUTPUT TENSION IN THE DEMAND GROWTH TO INCREASING MIDDLE EAST Iraq is aiming to increase average output by another between Saudi Arabia half a million b/d this year and Iran is unlikely to (including Kurdistan). SLOW DOWN Increased political tension Demand growth will fall from its 2015 high of 1.8 mn b/d. IEA predicts a 'healthy' 1.2 million b/d. impact production levels or prices. Global Oil Demand vs Production Forecast (mn b/d) 98 Production 97 96 Demand 95 94 Q2 Q3 Q4 USA Breakdown of 2016 OPEC Global Oil Production 21.3% 33-7% 45.0% Other Argus Crude reports daily on the global crude markets. Analysis and pricing for more than 80 different internationally-traded crude streams make this report a must-read for market participants. www.argusmedia.com/Crude-Oil/Argus-Crude Copyright © Argus Media 2016