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Global oil demand growing at fastest pace for five years

Global oil demand growing at fastest pace for five years thumbnail

World oil demand surged in the first six months of 2015 compared with the same period in 2014, according to national estimates submitted to the Joint Oil Data Initiative (JODI).

Petroleum demand is responding in the expected manner to a halving in the price of crude and significant declines in the price of most fuels in most consuming countries, as well as continued economic expansion in much of the world.

Fifty-nine countries, accounting for 75-80 percent of global oil consumption, have submitted demand estimates for both the first half of 2014 and 2015 to JODI.

Submitters include all the world’s major consumers, with the notable exceptions of Russia, Iran, Indonesia, Venezuela, Malaysia, South Africa and United Arab Emirates.

Submitters reported consumption averaged 71.4 million barrels per day (bpd) in the first six months of 2015, up from 69.1 million bpd in the prior-year period, an increase of 2.3 million bpd or 3.3 percent.

China accounted for slightly over half the total increase, with reported consumption of petroleum products up by 1.3 million bpd, more than 13 percent.

Other countries reporting substantial increases in demand included the United States (+470,000 bpd), India (+205,000 bpd), Turkey (+180,000 bpd), Saudi Arabia (+115,000 bpd) and Korea (+100,000 bpd).

Smaller increases in demand were reported by Germany (+20,000 bpd), France (+18,000 bpd), Britain (+29,000 bpd), Italy (+74,000 bpd), Spain (+26,000 bpd), Argentina (+40,000 bpd) and Poland (+40,000 bpd).

The increase in demand was broadly based, with 46 out of 59 countries in the data set reporting increased consumption in 2015 compared with 2014.

JODI is a partnership between the International Energy Forum, based in Riyadh, and six international and regional statistical agencies (IEA, OPEC, Eurostat, APEC, OLADE and UNSD).

The limitations of JODI data are well known and acknowledged by the partner organizations, but for many countries, especially the top 30 producers and consumers, “timeliness, coverage and reliability are at reasonable levels”, according to the secretariat.

There are several obvious caveats with the increase in petroleum demand reported by JODI. The first and most obvious is the enormous increase in reported fuel consumption in China, where the quality of the data is less reliable than in many other countries.

Without China, the reported increase in consumption is a little over 1 million barrels per day, or around 1.7 percent.

There are major doubts about the amount of fuels and especially crude disappearing into the country’s strategic stockpiles.

China’s national estimates may overstate oil demand, perhaps significantly, but the growth in the country’s consumption is unlikely to have been zero.

So the probable envelope for oil demand growth lies between 1.0 million bpd (if China’s consumption has been flat) and 2.3 million bpd (if China’s consumption has grown as much as its own data show).

The midpoint of the range is 1.65 million bpd, roughly in line with the 1.7 million bpd demand increase the International Energy Agency (IEA) is projecting for the world as a whole in 2015 (“Oil Market Report” Sep 2015).

Confidence in this range estimate is bolstered because the increase in reported demand outside China is so broadly based and there could be further increases in countries accounting for as much as 20 percent of global demand.

There is reason to doubt demand allocations to individual countries (for example the surge in Italy, which is three times the size of the increases reported in Britain, France or Germany).

National statistical agencies may be struggling to discern between domestic consumption, exports and stock increases.

But because the rise in demand is being reported in so many countries at the same time, it is unlikely to be a major error at global scale (national errors allocating between domestic and export demand should cancel out to some extent).

Some of the increase in reported demand may actually be going into increased stocks held by refiners, distributors and end customers.

But the continued strength of fuel prices and refining margins suggests that stocks have not built up to unwanted levels.

According to the IEA, oil demand is climbing at the fastest rate in five years, and the national statistics collated by JODI appear to bear out that conclusion.



22 Comments on "Global oil demand growing at fastest pace for five years"

  1. makati1 on Wed, 30th Sep 2015 8:55 pm 

    The oil is going somewhere or it would be stopped at the wells. How many tankers can be kept on standby at any price?

    I suspect that China is storing more than usual, but there is no way of knowing for sure. All oil numbers are slippery. (Sorry, that one got away.)

    One million bbls/day comes down to less than one cup of oil per person in the Western countries, per day. (One billion consumers). Or a little over a pint if you only count the 321 million Americans. Americans waste more than that.

  2. apneaman on Wed, 30th Sep 2015 9:18 pm 

    All this oil does not seem to be driving the economy

    Glencore Is Just the Beginning of a Wider Crisis in the Markets

  3. BC on Wed, 30th Sep 2015 9:54 pm 

    Mak, see here:

    China is hoarding oil (and skewing global demand figures) as if their leaders and PLA military planners are Peak Oilers and are preparing for a last-man-standing war against the West for the remaining resources of the planet.

    Perhaps they have studied history and don’t want to be in the position of Nazi Germany, fascisti Italy, and militarist Japan in the late 1930s.

    Nah, ya think? 😀

  4. makati1 on Wed, 30th Sep 2015 10:51 pm 

    BC, I agree. I noticed the comparison over the last few weeks when I watched some, older, non-American produced, YouTube vids about WW1, WW2, and the Great Depression. So many events then are very similar to those of today. And China is not stupid, no matter what some say about them here.

    I prep. I buy those items at the lowest prices I can find and when on sale if possible.

    The Chinese could be doing the same. They remember the Japanese needing their land and resources in WW2 and killing million of Chinese to get it. Resources are the lifeblood of war and when they are cut off…you lose. I suspect that that is also why they are cozying up to Russia. Like having a gas station, hardware and grocery store next door.

    Gasoline/diesel has a short shelf life, but petroleum can be stored forever. Ditto all of the other resources they have been buying in huge quantities from across the world.

  5. MrNoItAll on Thu, 1st Oct 2015 12:23 am 

    “China is hoarding oil…”

    They’re going to need it. Rolling out the tanks, helicopters and troop transports is going to burn a lot of fuel. It is a very large country with billions of people. When the riots and internal mayhem begin in China, there may not be enough gas in the world to restore order. But they’re going to give it their best shot nonetheless. And for that, they’ll need a LOT of fuel.

  6. makati1 on Thu, 1st Oct 2015 1:41 am 

    MRNO, the US military is the 8th largest consumer of energy/oil in the world. The Chinese would not even come close. They don’t have to leave their country to decimate everything within 1,000 miles, including the US Navy. They know it. The US knows it. You obviously don’t.

    Draw a line at the 1,000 mile distance from China’s borders and see that that takes in everything East of the Arabian Gulf and south to the tip of India. And that can be done in the first hours of the war.

    No major cities or faculties left. No invasion necessary. No one would be in shape to fight back. THAT is 21st century warfare, not tanks and vehicles. Ditto for the continental US and it’s ICBMs. Nothing left to fight with when the internet and the satellites are gone. Banking/money vaporized. Food supplies gone. Cities gone. No connectivity to anyone out of shouting range. THAT is 21st century war. Are you preparing/prepared?

  7. Davy on Thu, 1st Oct 2015 7:27 am 

    Dog Paw is teaching us about military doctrines, strategies, and tactics again. There is no one on this board more consumed by war lust than dog paw. NUK war with China and Russia winning is his military doctrine.

    The possibilities of NUK war are real but the higher probability is what MR alluded to generalized collapse with militaries being brought home to contain angry masses. This will happen in all countries. They will be in dog paw countries as well as the developed world. Collapse is an equal opportunity killer.

  8. joe on Thu, 1st Oct 2015 8:16 am 

    The nation’s with the highest increases also pay high government tax breaks to big oil to keep gas prices artificially low. The nation’s who don’t like the EU have some increase but not much. Also I would have expected an even bigger increase in the US except demand growth is sluggish because an aging population is driving less, this trend is set to dampen growth as it will in most of the world in the future. If only oil prices were THE only metric that mattered.

  9. BobInget on Thu, 1st Oct 2015 10:16 am 

    Iranian troops join Russian to defend Syrian President Assad.
    It had to happen. Using the terrible crush (scandal) during Hajj, Iran’s leaders have whipped up enough enthusiasm to confront Saudi Arabia’s hirelings. The so called ‘proxy’ war in Syria metastasized into a one on one, West vs East vs West global conflict. The main actors; Russia, Saudi Arabia, Iran, Iraq, US, NATO, Syria, Libya and Sudan.

    Hundreds of Iranian troops have arrived in Syria to join a major ground offensive on behalf of President Bashar al-Assad’s government, sources said on Thursday, a further sign of the rapid internationalization of a civil war in which every major country in the region has a stake.

    Russian warplanes bombed a camp run by rebels trained by the CIA, the group’s commander said, putting Moscow and Washington on opposing sides in a Middle East conflict for the first time since the Cold War.

    Poster’s notes;

    While the Pentagon denies it. Sources are saying the US has ‘Special Forces’ on the ground advising anti Assad rebel groups.
    While mid air clashes can’t be ruled out. A more likely scenario could be Iranian or Russian or US troops caught in ‘mistaken’
    air strikes. (frienenemy fire).

    It’s obviously far too early for coked up oil traders to digest this news. IMO, perhaps by Friday. Certainly Monday.

    What could possibly go wrong?

  10. makati1 on Thu, 1st Oct 2015 10:46 am 

    ‘Carter: US Willing to Work With Russia Against ISIS”
    “Hezbollah welcomes Russian buildup in Syria, says U.S. has failed”
    “U.S.-trained Syrian rebels gave equipment to Nusra: U.S. military”
    “Chinese troops to join Russian marines in Syria soon, says report”
    “Iraq to Share ISIS Intelligence With Russia, Iran and Syria”
    “French warplanes ‘totally destroyed’ Islamic State camp in Syria’
    “US-Russia Coordination On Syria Needed To Avoid ‘Incidents’: NATO”
    “U.N. sees refugee flow to Europe growing, plans for big Iraq displacement”
    “Migrant Crisis Sparks Balkan Border Battles As EU Buckles Under Overwhelming Refugee Flow”
    “Chinese Military Personnel, “Aerial Assets” Allegedly En Route To Syria”
    “The Collapse of Iraq and the Rise of ISIS: Made in America?”
    ” Endgame: Putin To Bomb ISIS With Or Without Obama”
    “Syria Civil War: Merkel Says Assad Must Be Involved In Syria Peace Talks Amid Mounting Tensions”
    “Migrant crisis: Farage says EU ‘mad’ to accept so many”
    “EU Refugee Crisis: How Will European Countries Pay For The Influx Of Thousands Of People?”

  11. shortonoil on Thu, 1st Oct 2015 3:57 pm 

    “Dog Paw is teaching us about military doctrines, strategies, and tactics again.”

    In the horrible, unbelievable, uncompromisable event of a nuclear war SAC would convert China into a sheet of glass in 18 minutes. Anyone fascinated by such horror is certifiably, unquestionably, undeniably one box short of a Happy Meal. It would be the end of the world you jug head; it would be end of you! If you have a death wish, buy yourself an gun, and get it out of my face!!!!

  12. beammeup on Thu, 1st Oct 2015 5:09 pm 

    Based on his tedious, repetitious posts, Mak strikes me as a miserable old loser who hopes to feel better about himself by eagerly awaiting the downfall of others. He obviously has a vendetta against the US, a country in which lots of us have managed to prosper, but one where poor old Mak apparently struck out. He’s also pretty delusional to think that he’ll be a safe spectator in his hut on the outskirts of a massively overpopulated city, full of desperately poor people, should a zombie apocalypse scenario play out.

  13. apneaman on Thu, 1st Oct 2015 5:25 pm 

    beammeup, have no fear a zombie apocalypse is coming one way or another. It is physically impossible to avoid. Take heart that is was caused in large part by our excessive prospering. Honestly, I would not rather have been born in one of the countries we exploited the fuck out of for their resources and slave labour, but I will not sit around and pretend and justify. We did it because we could and by any standard of morality it was fucking brutal. America led the charge. Mak pointing it out just pisses you off because you want to feel good about everything – feel deserving and justified. No enjoy your blood soaked prospering and stop whining about it. It will be over soon enough. You’re right, Mak will not escape either unless he dies before TSHTF. The second the empire pulls out of the p’s there will be a bloodbath internally and the Chinese will fill the void and lay down the law.

  14. beammeup on Thu, 1st Oct 2015 6:38 pm 

    Ape – You don’t know anything about what I want, and I’m not trying to “justify” anything. Simply pointing out what is painfully obvious, based on a million repetitious posts by a single poster, one who has zero grasp of the implications of his doomer wet dream.

    Only time will tell, but I don’t believe there will be a global zombie apocalypse. I think we’ll continue to see what’s been playing out for quite some time: A bumpy descent, where the world gets more crowded, dirtier, and more depleted over time. A series of massive AGW events could trigger a total system collapse, but short of that I think the system will stumble along for quite a bit longer.

  15. ghung on Thu, 1st Oct 2015 6:55 pm 

    Beamo said; “I think the system will stumble along for quite a bit longer.”

    Yeah, beam, you could be right, mainly because most folks don’t have a choice, and don’t give a shit what happens to others, at least until it happens to them. Creates a lot of social inertia when people simply don’t have anything else to do but muddle through whatever that day’s trials are.

    Eventually some black swan will land in their neighborhood or country and break the spell. I used to think most people won’t handle that very well, but it could be that, at that point, they won’t give a damn. As long as their TVs still work…..

  16. beammeup on Thu, 1st Oct 2015 7:59 pm 

    Ghung – Yep, the system has a lot of inertia, and the longer/slower the descent, the more time people have to adjust to the conditions at any given point in time. I’ve spent a big part of my career travelling to countries all over the globe and seeing people in widely differing societies dealing with a hugely differing local realities, in some cases not so pleasant to an outsider. Humans are pretty adaptable, as long as the changes imposed upon them don’t happen to too many of them too suddenly. All hell breaks loose then!

  17. ghung on Thu, 1st Oct 2015 8:08 pm 

    Frogs,, in pots.

  18. beammeup on Thu, 1st Oct 2015 8:39 pm 

    BTW, I follow a number of websites that deal with topics of energy supply and financial system health. I’ve been following them for 20 years (damn, I still miss The Oil Drum). I’m mainly interested in the articles that discuss the likelihood of various scenarios and present hard data and insightful analysis to back up their forecasts. I read the comments section, because sometimes there are posters who have firsthand knowledge of the topics in the articles. I get that there are widely differing expectations for the future and nobody’s crystal ball is perfect, especially not when outcomes are impacted by human psychology.

    What’s hard to stomach, and the source of the irritation behind my original post, is when somebody not only EXEPECTS the worst, by GLEEFULLY hopes for an outcome that involves suffering for millions of humanity. Regardless of your moral perspective on past history or current events, to relish the prospect of massive human suffering is among the worst traits a person can exhibit, IMO. When people post comments such as “I’m going to grab my popcorn and enjoy the show as country X descends into chaos,” you know that’s what you’re dealing with. The idea that a massive, total collapse will be confined to a single huge country such as the US, Russia, China, etc., while things remain pretty okay everywhere else is just silly, as most people here clearly understand. Interconnected world and all that.

  19. makati1 on Thu, 1st Oct 2015 8:43 pm 

    Glad so many of you supporters of the Empire know so much more about the part of the world that you talk about than the person who actual lives there. But keep your dreams. That mushroom cloud could appear over you anytime. I hope not, but we are closer today than anytime since Hiroshima. And there are a lot of them waiting to be used.

    As for China and the Ps, if the US pulled out, there would be no problems here. The Ps is no threat to China unless the Us has bases here. In fact, most of the billionaires here are Chinese or part Chinese for generations. Lots of Chinese live in my condo tower, along with Japanese, Korean, Thai, Filipino, European, Indian, American, etc.

    If you do not have first hand, current, personal experience with the Chinese, I suggest you do not parrot the USMSM propaganda. It ruins your credibility.

    BTW: Only the unlearned would mistake a lion print for that of a dog. He would not last long in the wild. lol.

  20. Davy on Thu, 1st Oct 2015 9:18 pm 

    Dog Paw, You don’t know shit from shinola about China. Just because you live in the P’s doesn’t make you a China or an Asian expert. You think it does but it don””t. Dog Paw, you know how we know this? Just reading your comments is evidence enough.

  21. dooma on Fri, 2nd Oct 2015 7:17 am 

    China is stockpiling oil AND buying every other resource they can obtain from any country desperate for a buck. And there is no shortage of those at the moment.

    How dare they go around the world and actually pay countries for their farms, water and oil.

    Surely they could take a leaf out of the I.O.U.S.A’s book and just bomb the fuck out of tin-pot countries and just take the stuff?

    Those naughty Chinese!

  22. Kenz300 on Fri, 2nd Oct 2015 10:16 am 

    We need to diversify our transportation options and move away from fossil fuels.

    Bicycles are an inexpensive way to travel short distances.
    Cities need to provide more safe bicycle and walking paths that connect homes, schools, businesses and jobs.
    Businesses need to provide safe places to lock and store bicycles when shopping or at work.
    Schools need to encourage children to ride a bicycle and parents need to stop driving their children to school. The children would be healthier and would get more exercise. It just might reduce the obesity epidemic in the world.
    The air would be cleaner, people would save money on transportation costs, we would use less fossil fuels and we might just make a small impact on Climate Change.

    Cities need to be more people centered and less auto centered. Walking, bicycling and mass transit are better options than filling the streets with more cars.

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