International Energy Agency or IEA stated in a latest update last week that growth in global oil demand is set to accelerate to just over 1 mb/d this year, from 830 kb/d in 2024, reaching 103.9 mb/d. Asia accounts for almost 60% of gains, led by China where petrochemical feedstocks will provide the entirety of growth. Amid an unusually uncertain macroeconomic climate, recent delivery data have been below expectations, leading to slightly lower estimates for 4Q24 and 1Q25 growth at 1.2 mb/d y-o-y.
World oil supply rose by 240 kb/d in February to 103.3 mb/d, led by OPEC+. Kazakhstan pumped at an all-time high as Tengiz ramped up, while Iran and Venezuela boosted flows ahead of tighter sanctions. Non-OPEC+ production is set to rise by 1.5 mb/d in 2025, led by the Americas. Following a 770 kb/d output decline last year, OPEC+ output could hold steady in 2025 if voluntary cuts are maintained after April.
Global crude runs dropped by 570 kb/d m-o-m to 82.8 mb/d in February, extending their decline from December’s five-year high of 84.3 mb/d, on planned and unplanned outages. Throughputs are forecast to average 83.3 mb/d in 2025, up 570 kb/d y-o-y as lower OECD activity partly offsets a 930 kb/d annual increase in the non-OECD. Refining margins recovered in February, as falling crude prices lifted profitability in all regions.
Global observed oil stocks fell by 40.5 mb in January, of which 26.1 mb were products. Non‑OECD crude stocks plunged by 45.3 mb, dominated by China where imports declined. Total OECD stocks rose by 11.2 mb, boosted by a 25 mb build in industry crude inventories. Oil on water fell by 6.7 mb. However, preliminary data for February show total global oil stocks rebounded, lifted by an increase in oil on water.
According to IEA, oil prices declined by about $7/bbl in February and early March as macro sentiment soured amid escalating trade tensions, clouding the outlook for oil demand growth. Plans by OPEC+ to start unwinding voluntary production cuts in April added to the expectation of comfortable crude balances in 2025.