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Page added on May 15, 2019

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IEA Cuts Oil Demand Growth Forecast

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The International Energy Agency (IEA) has cut its oil demand growth forecast for 2019 to 1.3 million barrels per day (MMbpd) in its latest oil market report.

The alteration marks the first change to the IEA’s 2019 demand outlook for several months. Prior to the cut, the IEA’s oil demand growth forecast for 2019 stood at 1.4 MMbpd.

“The reduction is mainly concentrated in 1Q19 on weaker than expected data for Brazil, China, Japan, Korea, Nigeria, and elsewhere lowering growth by 410,000 barrels per day versus our last report,” the IEA said in an organization statement posted on its website on Wednesday.

“Even so, slower demand growth is likely to be short-lived, as we believe that the pace will pick up during the rest of the year,” the IEA added.

In its latest report, the IEA said markets were remaining calm but conceded that geopolitics and industry disruptions were confusing the supply outlook.

“The ongoing geopolitical supply concerns around Libya, Iran, and Venezuela have been joined in the past few days by the attacks on shipping off Fujairah and on two pumping stations in Saudi Arabia,” the IEA said in an organization statement on its website.

“Despite the difficult geopolitical backdrop and other supply problems, headline oil prices are little changed from a month ago,” the IEA added.

Back in April, the IEA noted that markets were “adequately supplied” and that global spare production capacity remained at “comfortable levels”. The organization added that it stood ready to act if necessary to ensure markets remain well supplied.

Founded in 1974, the IEA was initially designed to help countries co-ordinate a collective response to major disruptions in the supply of oil. The organization is headed by Fatih Birol, who has served as IEA executive director since September 2015.

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9 Comments on "IEA Cuts Oil Demand Growth Forecast"

  1. Dredd on Wed, 15th May 2019 9:58 am 

    From noon Thursday, more than 20 Democratic representatives will read out the entire redacted Mueller report at the Capitol. And organizer Representative Mary Gay Scanlon of Pennsylvania thinks that number is likely to grow.

    According to The Washington Post, which reported the news Tuesday, the lengthy reading will be live-streamed and later shared as an audiobook. The session will take place in the House Rules Committee Room, and Scanlon estimated it could take between 12 and 14 hours.

  2. Dredd on Wed, 15th May 2019 11:12 am 

    Sleeping is giving in (The Shapeshifters of Bullshitistan – 18).

  3. Robert Inget on Wed, 15th May 2019 1:26 pm 

    In limbo: the dirty Russian oil no one wants to pay for – ODB

    ODB picked up an article on the dirty Russian oil mess. IMO, this is going to be a very big problem – way bigger than has been reported/considered. 19 mm barrels are stuck in pipelines, vessels, and possibly refiners. And the due date is coming due.

    It’s now time for payment for the oil. A lot of these purchases are made under the security from an international bank. So, at this point, some kind of settlement among:

    – Producers/Sellers
    – Pipelines/Transporters
    – Vessels/Transporters
    -Traders/ Buyers and Sellers
    – Refiners/Buyers
    – Inspectors
    – Banks – Financers and Securers (L/C’s)
    – and of course Lawyers

    Today as it now stands 19 mm barrels of contaminated Russian crude oil from at least three different Russian oil companies is stuck in pipeline(s) and vessels and NOT moving. As I have mentioned in the past, most Pipeline transportations occur DURING month 1, and are payed for on the 20th of month 2 (notice that coincides with front month price changes, Ie. the 20th of the month), and most vessel shipments use 30 day payment terms.

    Generally, in each case title passes at loading. That is why the inspecters and the banks are players in this quagmire. With this many different players, this volume of money (the article said $1.2 bn, and the possible damages and resulting costs associated with (1) getting the oil removed, (2) disposing of the oil, (3) cleaning the vessels it was in, and repairing any transport or possible refining assets it may have damaged; it will be incredibly difficult to settle this mess.

    It also involves several different countries (5 or more), each with their own commercial and marine law. It is difficult to determine how long it would take to settle this dispute involving just one party of each of the above mentioned above, all in one country. I can tell you that traders, vessel owners, and refiners have marine litigation and negotiation going on constantly about past disputed costs. I can also tell you that many of such disputes are settled by one party seeing themselves advantaged in another transaction in the future and simply taking a “deduction” of payment on a future transaction.

    With all of the different parties, countries, and laws involved, I can’t imagine how this will settle out. Settlement is one thing, movement is another. This oil is paralyzed ;
    – not moving,
    – not being taken out,
    – contaminations not being cleaned – pipelines, vessels, and possibly refineries,
    – payments not being made,
    – lawyers and politicians/leaders not “fired” up yet, and
    – oil not being being refined.

    This has to be a current or coming “very dark cloud mass” not quite yet appearing on the radar that is tracking the ever growing PERFECT STORM. I really think this could be a very big deal!.

    So much for supply?
    Not by a long shot.

    Nigeria (offshore) in Force M
    Iran, sneaking crude into the US of all places.
    Cargoes shifted from ship to ship lose ID.
    Still, production off at least 2 Million B’ Per day
    Venezuela, down for the count.
    Russia/Europe see article
    Mexico, down for the count.

    Worst of ALL.
    WARS, militaries, huge consumers of crude oil.
    (ask KSA about their adventures in Syria, Yemen,
    Qatar) NOW IRAN
    THE Pentagon is the biggest single crude oil consumer in the WORLD. Ask XOM.

    Just mobilization for WW/3 will use millions of barrels not figured into IEA books.

    Trump once considered the ‘useful idiot’ has outgrown his idiot status. Trump is now being classed as just another *Fucking Moran, *(Rex Tillerson)

    Trump followed Putins directions to a tee.
    (he listens to Putin but not the FBI or CIA)

    “a fine kettle of Fish”
    https://www.youtube.com/watch?v=GD3HgSZwmyk

  4. Robert Inget on Wed, 15th May 2019 1:40 pm 

    At the very least, OECD stocks are inflated by 19 million barrels of un-useable
    crude oil. This after OECD stocks fell by 28 million in the first quarter.

    World oil stocks are far tighter than IEA would have us believe.

    Keep in mind most of this so called ‘tight oil’
    is not real honest to gosh crude oil. Once it was classed are ‘liquid gas’ what ever that means.

  5. Davy on Thu, 16th May 2019 5:15 am 

    BRI is a dead man walking. 20 years too late to be an economic force. It is now mal-investment at a time when the world cannot afford it. Ocean shipping is the most efficient and the BRI wants to reinvent what is already a highest of comparative advantage. The BRI wants to open new ports when trade is already in decline.

    “Significant Slowdown” Spooks Maersk At Mediterranean’s Third Largest Port”
    https://tinyurl.com/y4lgmcjb zero hedge

    “Maersk has been operating from Malta for at least a decade, handling import shipping routes to and from China. Industry sources said shipping volumes have already decreased at Freeport, as a severe economic slowdown in Europe and Asia have sent container rates between both regions into a tailspin in the last several quarters. “The slowdown can already be felt and there are already fewer people working, particularly on overtime,” the source said. Last month, data from the CPB Netherlands Bureau for Economic Policy Analysis revealed world trade volume fell 1.8% in the three months to January compared to the preceding three months as a global slowdown gained momentum.”

    “The tit-for-tat trade war has led to a massive re-pricing of global trade expectations for 2H19, expected to trigger a global trade recession if Trump initiates a 25% tariff on the remaining $300 billion of Chinese goods. The global downturn in trade is widespread geographically. The disruption at Malta Freeport highlights that China and Europe are in a synchronized slowdown with no trough in sight.”

  6. Davy on Thu, 16th May 2019 5:29 am 

    “Freight Night: Logistics Data Paint Dire Picture For Shipping, Broader Economy”
    https://tinyurl.com/y6243j34 zero hedge
    https://tinyurl.com/y47fhg59 global trade graph

    “Additionally, the report notes that it is “concerned about the severe declines in international airfreight volumes (especially in Asia) and the recent swoon in railroad volumes in auto and building materials. We see the weakness in spot market pricing for transportation services, especially in trucking, as consistent with and a confirmation of the negative trend in the Cass Shipments Index. As volumes of chemical shipments have lost momentum in recent weeks, despite the rally in the price of WTI crude, our concerns of the global slowdown spreading to the U.S., and the trade dispute reaching a ‘point of no return’ from an economic perspective, grow.”

  7. makati1 on Thu, 16th May 2019 5:52 am 

    The World Island can only profit from the BRI, so all you are going to hear from the loser America is negative propaganda. It circumvents American controls and that scares the shit out of the dying empire. The US is self isolating, thanks to Trump. GO TRUMP! TRUMP IN 2020! TRUMP, AMERICA’S GODZILLA. LMAO

  8. Antius on Thu, 16th May 2019 6:01 am 

    “BRI is a dead man walking. 20 years too late to be an economic force.”

    The Chinese know full well that Belt and road will not provide any cost advantage for shipping; the same would have been true 20 or even 40 years ago. There was never and never will be an economic driver for this.

    The purpose of BRI is to link Chinese factories to customers in Europe, bypassing the sea-lanes that are controlled by the US navy. China does not and will not have the military strength to challenge USN any time soon. BRI removes the problem (at a price) without the need to initiate a major war that would shatter global trade. Everything is a game of chess for the Chinese.

  9. Davy on Thu, 16th May 2019 6:22 am 

    “The Chinese know full well that Belt and road will not provide any cost advantage for shipping”
    “The purpose of BRI is to link Chinese factories to customers in Europe, bypassing the sea-lanes that are controlled by the US navy.”

    Knowing there is no cost advantage but pretending there is still a growth impulse is a poor chess move. The other issue is those who are entering development projects with the Chinese are getting sucked into a Chinese trap. I am not saying the Chinese are wrong and the Americans are right. The American system of economic and military hegemony is a failed policy that will only hurt all involved including the Americans. I am also saying the BRI is not the right economic impulse today for the realities of global decline. The Chinese are fantastic with mal-investment mainly because there system is so highly growth driven. This high growth impulses are appearing not to be the future but the Chinese are hell bent on exporting them to continue the unsustainable. They have no choice. If they are doing this partly because of fear of US control over the seas then it still does not make these actions any smarter and really just more desperate. The Chinese are little different than the Americans with hegemony it is just the Chinese version is more economic than a military version. The results are still unsustainable and heading for failure.

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