The Organization of Petroleum Exporting Countries will cut crude exports to the lowest level in two months as refiners around the world conduct seasonal maintenance, according to tanker-tracker Oil Movements.
OPEC, responsible for 40 percent of global oil supplies, will reduce shipments by 620,000 barrels a day, or 2.5 percent, to 23.74 million a day in the four weeks to April 5, the researcher said in an e-mailed note. That’s the lowest since early February. The figures exclude two of OPEC’s 12 members, Angola and Ecuador. The group will need to cut production by as much as 1 million barrels a day during the rest of the year to prevent a surplus, the consultant said.
“April is a seasonal low-point,” Oil Movements founder Roy Mason, said by phone from Halifax, England. “This a global seasonal event. Refinery runs are running down everywhere so demand is dropping away.”
Global oil consumption typically ebbs at the end of the first quarter as demand for heating fuel tapers off and refiners start to perform routine overhauls. Brent crude slipped 3.1 percent this month, trading at $105.68 a barrel on the ICE Futures Europe exchange as of 3:29 p.m. London time.
Excess inventories in developed nations will accumulate this year amid rising non-OPEC supplies and higher production from Iraq, unless Saudi Arabia and other Gulf-based OPEC producers restrain output, Mason said.
Middle Eastern exports will average 17.4 million barrels a day in the four weeks to April 5, compared with 17.94 million a day in the period to March 8, Oil Movements said. These figures include non-OPEC nations Oman and Yemen.
Crude on board tankers will drop by 1.8 percent to 488.18 million barrels in the four weeks to April 5, from 496.91 million in the previous period, data from Oil Movements show. The researcher calculates volumes by tallying tanker bookings and excludes crude held on vessels for storage.
OPEC’s members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. The group will next meet on June 11 at its headquarters in Vienna.