Balance: Peak Summer Demand Helps Tighten Market

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High oil demand in August outpaced supply by 2.4 million barrels per day, preliminary data shows. The third quarter is now set to draw inventories by 1.2 million b/d, and the fourth quarter by 800,000 b/d. These balances show that Saudi Arabia’s voluntary output cuts of 1 million b/d are needed to keep the market tight. For the year, inventories are set to drain by just 200,000 b/d, but they were already below average levels for starters. Looking ahead, the first half of 2024 shows inventory builds of 650,000 b/d, even with Energy Intelligence balances extending the kingdom’s voluntary cuts in full through the first quarter of 2024 and by 500,000 b/d for the rest of the year. Market management seems by no means over.

Oil Supply, Oil Demand, Oil Inventories, Crude Oil, Oil Products
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