Pumpjacks dip their heads to extract oil in a basin south of Duchesne, Utah on Thursday, July 13, 2023. AP
Brent crude oil futures prices declined to $79.54 per barrel on 8 November 2023 from $80 per barrel, as Beijing's Covid toll and a strong dollar fuelled recession risks. Output from the OPEC+ alliance has held mostly steady, while usage is seen gaining momentum.
The IEA joined OPEC in lifting 2023 demand growth estimates, with the former seeing consumption rise 2.4 million barrels per day (mbpd) after upgrading its outlook. Figures out of China also point to industrial and retail resilience despite COVID-19 controls.
Still a tentative economic backdrop leaves room for upside surprises in fuel demand. Sky-high refining costs in China and import restrictions from top supplier Saudi Arabia also risk limiting uptake.
Production rose marginally across the globe in October. Non-OPEC production increased by 200,000 barrels per day to 73.7 million barrels per day as Norway and the Americas boosted supply, offsetting falls in Russia and Brazil.
OPEC volumes inched up by 80,000 barrels to 27.9 million, led by gains in Angola and Iran countering declines led by Saudi Arabia and Libya, while Saudi cuts continue alongside its OPEC+ alliance with Russia.
Nigeria boosted supply to the highest since 2020 after oil worker negotiations, while Iraq works to restart exports from the troubled pipeline connecting north to Turkey. US shale is projected to set fresh records.
The supply-demand dynamics leave oil historically tight even as economic uncertainty persists. With OPEC+ likely extending cuts and China's 2021 demand bounce as a guide, the upside for fuel consumption remains.