Monthly Oil Market Report
2 3 ( &
12 April 2017
Summeroil market outlook
OPEC bulletin 3–4/17
Despite some downside risks, general expectations
for demand growth for oil products in the com-
ing months remain bullish, according to the OPEC
Secretariat in Vienna.
Monthly Oil Market Report (MOMR)
it said that this view was supported by a firm eco-
nomic performance across the globe and the expected
increase in demand for gasoline over the coming driv-
ing season, mainly in North America and Asia.
“Higher demand for oil products will encourage
refiners to maximize throughputs following the end
of the spring maintenance season, amid new capac-
ity coming on line in North America, the Middle East
and Asia,” a feature article in the publication stated.
“This, in turn, will increase demand for crude oil
over the comingmonths and already has for long-haul
crude oil deliveries.”
In looking at the summer oil demand outlook, the
observed that the return of refineries fromsea-
sonal maintenance andhealthy demand, togetherwith
the high conformity observed in OPEC and non-OPEC
production adjustments, should enhance market sta-
bility and reduce the volatility seen in recent weeks.
It noted that product markets and refinery mar-
gins, particularly in the Atlantic basin, were impacted
in 2016 by the high level of inventories worldwide.
Additionally, the increase in crude oil prices and
the deceleration in diesel demand growth, mainly in
China and theUnited States, capped refinerymargins.
“In general, product crack spreads struggled to
recover in the latter part of the year as the colder win-
ter weather failed to boost prices,” said the article.
“TheUS is typically a key driver of productmarkets
in the run-up to the summer driving season. Despite
weakness at the beginning of 2017, the US gasoline
market has seen some recovery in recent weeks.”
The report said that after slowing by around
170,000 b/d year-on-year in January, US gasoline
demand had been on the rise, averaging more than
9.3m b/d in March, according to preliminary EIA
Another positive factor, it said, had been the
continued decline in US gasoline
inventories, which had fallen by
around 20m b since the end of
“Heavy refinery maintenance
and higher exports to Latin
America have contributed to
these draws,” the feature article
It saidmiddle distillates had
also started to show a positive
performance in the US. A con-
tinued draw had been seen
in inventories amid demand
reachingmore than 4mb/d in
March, following growth of around 240,000
Outside the US, it said, the middle distillates mar-
ket had experienced some recovery from the slump
seen last year in several regions.
“Demand has picked up since the fourth quarter
and is expected to continue to recover over the coming
months, supported by the improving economic per-
formance, particularly in Asia where manufacturing
PMIs have moved higher, not only in India and China,
but also in Vietnam and the Philippines.”
said gasoil demand in China was
expected to be supported by higher investments in
infrastructure and increasing mining activities.
“Healthy economic activities in Asia will have a
positive impact on all products in the region — par-
ticularly gasoil — in the coming months.”
In Europe, said the report, gasoil consumption
had also improved, due to the improving economy
across large parts of the continent, colder weather
during the first quarter of 2017 and the high growth
in vehicle sales.
However, this momentum was not expected to
continue over the rest of the year. As a result, global
gasoline and distillate demand was forecast to grow
by around a combined 718,000 b/d in 2017.
Summer outlook for oil
products “remains bullish”