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Oil Market Snapshot – November 2022

  • The first week of November ends with Brent trading c. $98/bbl, up c. $5/bbl on a month ago after an OPEC+ quota cut of 2 million b/d
  • Our global demand growth of 2.12 million b/d for 2022 (unchanged on previous), which would keep demand below 2019 levels for another year
  • Concerns about global economic growth for 2023 are growing as energy high prices, Russia’s war in Ukraine and China’s economic issues all continue
  • The practical effect of the new OPEC+ quotas is a 1 million b/d cut to production from August levels, primarily from OPEC countries close to quota: Saudi Arabia, UAE, Kuwait and Iraq
  • We forecast global supply growth of 4.13 million b/d in 2022 (-310,000 b/d on previous) factoring in this cut and reductions in Russian and Kazakh output
  • Global supply growth falls to 1.23 million b/d in 2023 on OPEC+’s current quotas, as Russian exports decline from January in response to European sanctions
  • We see inventories building 510,000 b/d on average in 2022 (-100,000 on previous), and 30,000 b/d in 2023 (-450,000 b/d on previous) on current policies

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by Graham Walker // 4 November, 2022

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