OPEC says demand for crude to rise by 1.2m/bd in 2016

OPEC

Dr Ibe Kachikwu, the new President of the Organisation of Petroleum Exporting Countries (OPEC), weekend said that the demand for OPEC crude is expected to rise by 1.2 million barrels per day next year.

 

Dr Ibe Kachikwu, Chairman of the OPEC and Nigeria's Minister of State for Petroleum

Dr Ibe Kachikwu, Chairman of the OPEC and Nigeria’s Minister of State for Petroleum

Kachikwu, who is also the Nigeria’s Minister of State for Petroleum, said this in a statement signed by Ohi Alegbe, Nigerian National Petroleum Corporation (NNPC)’s Group General Manager, Group Public Affairs Division, and released to newsmen in Abuja on Saturday.

The minister was quoted as giving the expectation while addressing the 168th (Ordinary) Meeting of the OPEC held in Vienna, Austria.

The chairman said that the expected increase in demand would average 30.8 million barrels per day in 2016, leading to a more balanced market.

He projected that in the years ahead a balanced and stable market would be crucial to ensuring continued investment in the industry to meet the world’s growing energy needs.

“The conference is focused on enhancing market stability, which will be of benefit to all stakeholders and contribute to global economic growth.

“Dialogue and collaboration with consumers, non-OPEC producers, oil companies, and investors are essential to attaining the common goal of a more orderly oil market.

“In 2015, we have seen positive examples between OPEC and non-OPEC countries, and the Asian ministerial energy round-table held in Qatar in November.

“OPEC has also held bilateral dialogues with Russia and China this year, and later this month the OPEC-India energy dialogue would have its first meeting,” the statement read in part, quoting Kachikwu.

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It said the World oil demand in 2015 grew by 1.5 million barrels per day, up from 1 million barrels per day in 2014.

“Next year, we foresee a growth of 1.3 million barrels per day to average 94.1 million barrels per day, with most of this growth coming from non- Organisation for Economic Co-operation and Development (OECD) countries.

“The statement said that as far as supply was concerned, non-OPEC countries would continue to see significantly reduced production growth as compared to past years.

“In fact, in 2016, we anticipate a contraction in non-OPEC oil supply,” the statement further read.

It said that the downward trend would stem mainly from the impact of investment cutbacks and the drop in U.S. tight oil output, which had been on the decline since May 2015.

It said that was clearly illustrated by the drop in the number of newly drilled wells and the reduction by half of active drilling wells.

According to the statement, OPEC is committed to playing its part in protecting the environment and supporting sustainable development.

The statement added that its member countries are taking part in the climate change negotiations in Paris.

It said that member countries were committed to the goal of full, effective and sustained implementation of the UN framework convention on climate change.

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