FILE PHOTO: The logo of the Organization of the Petroleum Exporting Countries is seen outside their headquarters in Vienna, Austria December 7, 2018. REUTERS/Leonhard Foeger
The current oil demand situation in Asia, which accounts for about 36% of the global total and almost 80% of expected growth in coming years, shows the nature of the dilemma facing OPEC+. What may be even more concerning for OPEC+ is the breakdown of Asia’s November imports, with much of the increase being down to a rebound in China’s buying.
The answer may lie in the fact that oil prices were low during the period when November-arriving cargoes were purchased, from late September through to October.Global benchmark Brent futures dropped to a closing three-month low of $39.27 a barrel on Oct. 2, and while they did recover somewhat, the highest close for that month was $43.34 on Oct. 8, and they dropped to close at $37.46 on Oct. 30.
This led to higher imports of Saudi crude by China, with 2.13 million bpd expected in November, up from 1.4 million bpd in October, once again placing Saudi Arabia as the top supplier to the world’s biggest crude importer.
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