World Oil Demand
OPEC Monthly Oil Market Report – October 2017
Brazilian oil demand
has been positive in 2017. On a cumulative basis, data up to August suggests
moderate growth in oil requirements of around 11 tb/d y-o-y, compared to a decline of around 80 tb/d y-o-y
during the same period last year.
The economic advantage of gasoline over ethanol played a big part in increasing gasoline demand growth in
every single month of 2017. Currency exchange and weather conditions are usually factors impacting
ethanol production. Farmers opted to produce sugar in lieu of ethanol as economics supported sugar
production, limiting ethanol availability and increasing its relative value compared to gasoline. Gasoline was
more economical for drivers as most vehicles in Brazil are equipped with dual-fuel engines that can burn
both fuels. Gasoline consumption was 52 tb/d higher than the same period last year, while ethanol demand
declined by similar quantities.
Diesel oil is flat on a year-to-date basis, despite y-o-y gains in June, July and August. These monthly
increases are indicative of improving economic conditions in the country as inflation rates, consumer
confidence and manufacturing PMI indexes are at stable, or rising, levels. As a result, diesel oil demand
from the industrial and transportation sectors has improved.
Fuel oil demand declined by more than 15 tb/d, or 4% y-o-y, on a cumulative basis. As with diesel oil,
strengthening economic conditions have contributed positively to fuel oil demand numbers as increased
consumption was observed in the power generation sector and in the use of fuel oil as a bunker fuel.
Table 4 - 7: Brazilian oil demand*, tb/d
Oil consumption in
was flat during the month of July 2017 at 0.72 mb/d, with mixed product
performance. All transportation fuels were in positive territory with the exception of diesel oil. Jet/kerosene
and gasoline increased by around 17% and 4% y-o-y respectively. Conversely, fuel oil recorded a drop of
Looking forward, the risks for
are currently balanced with a projection for economic
improvement by the major consuming nation of the region, Brazil, which is anticipated to promote
government spending. The continuation of lower oil prices as well as unusual weather conditions should also
support for oil demand growth. Conversely, deteriorating economic conditions elsewhere in the region should
cap oil requirements.
, projections are largely dependent on possible improvements for the overall economy of the region,
oil demand should also improve as a result, and the low baseline of comparison this year should provide
additional support. In terms of products, diesel oil and gasoline will have higher growth potential and are
expected to fuel the industrial and transportation sectors.
Latin American oil demand
is anticipated to increase by 47 tb/d in 2017. During 2018, oil demand growth is
forecast to be higher than 2017, recording growth of 85 tb/d.
Sources: JODI, Agencia Nacional do Petroleo, Gas Natural e Biocombustiveis and OPEC Secretariat.
Note: * = Inland deliveries.