Oil Updates — Crude declines; OPEC expects China 2023 oil demand to grow 500k-600k bpd
Oil prices fell for a second straight session on Wednesday, driven by fears that more aggressive US interest rate hikes would hit demand, while the market awaited further clarity on inventories.
Brent crude futures dipped 5 cents, or 0.6 percent, to $83.24 per barrel at 11.50 a.m. Saudi time.
US West Texas Intermediate crude futures slid 19 cents, or 0.24 percent, to $77.39 a barrel.
Both Brent and WTI fell by more than 3 percent on Tuesday after comments by US Federal Reserve Chair Jerome Powell that the central bank would likely need to raise interest rates more than expected in response to recent strong data.
OPEC says China 2023 oil demand to grow 500,000-600,000 bpd
China’s oil demand will grow 500,000 to 600,000 barrels per day in 2023, the Secretary General of the Organization of Petroleum Exporting Countries, also known as OPEC, Haitham Al Ghais said on Tuesday, as the world’s top crude importer emerges from COVID-19 restrictions.
“With China opening up, we are quite optimistic, cautiously,” he told the CERAWeek energy conference in Houston.
OPEC expects global oil demand growth to grow by 2.3 million barrels per day in 2023, he said.
Al Ghais said he was not concerned about the rerouting of Russian crude exports to countries such as China and India in the wake of Russia’s invasion of Ukraine. OPEC had witnessed many such changes in oil flows in the past, whether due to international politics or the emergence of new demand centers, he said.
“This is typical where we have redirection in flows from the east to the west or west to the east,” Al Ghais said.
Russian oil production has been resilient, Al Ghais said, adding that the country’s barrels have found buyers in markets like China, India and Turkiye.
OPEC and Russia are part of the OPEC+ alliance, working together on supply policy for global markets. When asked whether the alliance remained viable, Al Ghais said that the alliance is critical to stable oil markets and has been since producers started working together in 2016.
US crude output, demand to rise in 2023: EIA
US crude production and demand will rise in 2023 the US Energy Information Administration said in its Short Term Energy Outlook on Tuesday.
The EIA projected that crude production will rise to 12.44 million bpd in 2023 and 12.63 million bpd in 2024.
The agency also projected petroleum and other liquid fuels consumption would rise to 20.4 in 2023 and rise to 20.8 million bpd in 2024.
(With input from Reuters)
