Daily Energy Report
European oil demand flat, Kazakhstan oil watch, US & UK make ship warnings, Sudan oil exports, Russian seaborne oil products, Europe refiners like sweet crude, South Korea releases Iran funds, and mor
Chart of the Day: Despite challenges, European oil demand to remain virtually flat
Figure (1) above shows the trend in European oil demand and forecasts to the end of 2024 by the US Energy Information Administration (EIA). After the recovery from COVID and lockdowns, the demand is virtually flat and expected to remain so.
EOA’s Main Takeaway
Despite slow economic growth, high energy prices including petroleum products, and heavy penetration of electric vehicles, European oil demand has been flat and expected to remain virtually flat to the end of 2024. The IEA expects an average decline of 150,000 b/d in oil demand in 2024 relative to the average demand in 2023 because of the increase in the number of electric vehicles. OPEC believes demand will increase by 60,000 b/d.
We believe that European oil demand could increase by up to 110,000 b/d in the case of strong economic growth and relatively stable oil prices around current levels, despite the increase in electric vehicles. European oil demand is still tied to GDP growth despite the weakening relationship over the years. In other words, if oil demand drops quickly, it is because of a decline in economic activities, not because of electric vehicles.
Story of the Day
Kazakhstan might adjust its oil production forecast for 2023 due to power outages in the country, the Interfax news agency reported on Monday, citing the Kazakh energy ministry.