Oil Market Outlook 2012

Global Investment House of Kuwait today released its Oil Market Outlook 2012. Here are the major highlights:

• Average WTI crude oil prices increase by 19.6%YoY to USD94.9 per barrel in 2011
• Oil prices expected to be volatile as European debt crisis remains unresolved
• China to remain the main oil demand growth driver in 2012
• WTI crude oil prices expected to stay in the range of USD95-100 per barrel in 2012

Increase in geo-political risk keeps oil prices high Read more

2012 global oil demand growth forecast lowered

Global oil demand was lowered today by the International Energy Agency who said that it expects global oil demand to grow by 1.1 million barrels a day in 2012, lower than its previous estimate of 1.3 million barrels a day. Read more

Saudi Arabian Oil Minister discusses Straits of Hormuz, oil production

On “Global Exchange on CNN International” today, John Defterios and Ali Al Naimi, Saudi Arabian Oil Minister discussed oil production and price, Iran and the Straits of Hormuz. Here is the transcript of the exclusive interview.

Q.: China has concerns that Iranian crude exports may be hit by sanctions and they don’t think more sanctions is the answer, could you meet the demands of Chinese crude demands if they were to ask?

Read more

Crude oil forecasts raised

On Friday crude oil for February delivery fell to a three week low after comments from EU officials signalled a six-month delay in exercising a ban on oil imports from Iran. After trading above $100 for most of the week, the forward contract slid to a weekly low of $97.70  during the last trading session. Read more

OPEC daily basket price stood at $109.40 a barrel

The price of OPEC basket of twelve crudes stood at 109.40 dollars a barrel on Tuesday, compared with $106.84 the previous Friday, according to OPEC Secretariat calculations. Read more

Oil market fundamentals could ease over next five years

Oil market fundamentals could ease over the next five years, according to the International Energy Agency, which revised down its demand forecasts through 2016 and revised up its supply projections after 2013 on Tuesday,

“Our preliminary medium-term update suggests a more comfortable market outlook than looked likely six months ago,” the IEA said in its monthly Oil Market Report. Read more

Oil prices remain focused on Euro zone liquidity crisis solutions

Oil futures gained last Friday, taking weekly gains to 4.3% after seesawing for most of the session as investors were concerned ahead of an euro zone summit next week.

Crude oil futures for January delivery advanced 76 cents, or 0.8%, to end at $100.96 a barrel on the New York Mercantile Exchange. That was oil’s highest settlement since November 16. So far, oil has posted weekly gains for seven out of nine past weeks.

Boosted by tension over Iran’s nuclear program along with the joint central bank efforts to help sort out the liquidity crisis in Europe, crude for January delivery posted its first weekly gain in three weeks.

Positive economic data from the U.S., along with another slide in crude inventories pushed the price of a barrel over $100 and contributed to its rally. An unexpected decrease in U.S. unemployment rate fuelled optimism over the world’s largest oil consumer’s economic recovery. Market players continue to monitor the pace of U.S. recovery, because of the close relation it has to the price of crude.

However, increasing demand for the USD offset the rally in crude. Despite the good employment numbers, economists remain wary about the outlook due to a sudden decrease in the American labor force. Analysts also believe that recent gains are inflated, because of supply shortfalls caused from tensions over Iran.

Recent speculation of the Eurozone moving a step closer to resolving the sovereign debt crisis also provided support to the oil price.

Looking forward, oil prices will remain focused on talks that emerge from the meetings in Europe.

The End of Cheap Oil

• What this news means for the Middle East oil producers?
• Investment of $38 trillion required to meet energy demand

During the G20 summit in Cannes, the Chief Economist at the International Energy Agency, Dr. Fatih Birol, delivered a keynote speech at the B20 Business Summit.

According to him, the World Energy Outlook 2011, which will be released on 9 November, will show that $38 trillion of investment is required to meet projected energy demand through to 2035 and that investors in energy projects are facing a multitude of risks. Read more

Oil prices to rally on higher demand

During the last week, crude oil price for December delivery rallied on positive economic news to close above $90 for the first time since July.

Oil advanced 3.27% on Thursday helped by positive data about the US economy, registering its fastest growth in the year and easing fears of a possible recession. However, the rise was halted with the third largest oil consumer, Japan, posting a decline in its industrial output on Friday. Data released showed factory production fell 4.0% in September, almost twice as much as predicted by analysts. As a result, crude for December delivery was down nearly 1.0% and closed near the $93 mark on Friday. Read more

Future demand for oil may pull oil price lower

Last Monday, sluggish demand from big oil consumers pushed the price of crude for November delivery to a low of $82.75 per barrel. However, since then it managed to recoup the losses, reaching a high of $87.42 on Friday. Further during the latter half of the week, prices were slipping below the $84 mark, after the Energy Information Administration (EIA) reported an unexpected increase in crude inventory.

On Thursday, the EIA reported an increase of 1.3 million barrels of crude for the week ended October 7, pushing the price lower. Read more

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