Wednesday, May 12, 2004

Rising oil prices are not simply a story of OPEC choking global supply; there is also the little matter of rapidly rising demand to contend with.
As Brent crude in London opened at a 13 year high of $37.46 a barrel, the International Energy Agency said global oil demand growth in 2004 is set to reach 2.5 per cent, the fastest rate since 1996. The increase in demand by volume will approach 2m barrels a day, the largest gain since 1988. . . .

Where last year it was Chinese demand that increased in leaps and bounds, the IEA said, "this time, OECD countries are responsible for a sharp upward revision" of 2004 demand growth. Of the upward revision of 660,000 b/d, some 580,000 b/d is accounted for by the industrialised countries for which the IEA is the energy watchdog.

In North America the driving force of the upward revision is higher jet fuel and liquid propane gas demand, while in Europe it is primarily distillates for transport fuel.
Unfortunately the IEA has not seen fit yet to put the May Oil Market Report online, so all the General has to go on is the FT's report. Hopefully the report will be online soon. Surely some tasty little morsels are hidden inside just waiting to be uncovered.


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