A consistent increase in Atlantic Basin crude export volumes to Asia over the next five years will have as far-reaching repercussions for crude oil shipping as the shift in Russian crude exports, the International Energy Agency (IEA) has said, reports Splash247.
Paris-based intergovernmental organisation
The Paris-based intergovernmental organisation said it expects crude and product trade flows to expand in the medium term, with the Atlantic Basin, excluding Russia, experiencing a surplus increase as production rises in the US, Brazil, and Guyana, while refinery activity falls in line with a drop in demand for transport fuels, particularly in the EU.
Continued demand growth in Asia is expected to by far outpace increased crude supplies from the Middle East by 2028. IEA forecasted Asia’s crude and condensate import requirements will rise by 4.8m barrels per day to 28m barrels per day in 2028, with the Atlantic Basin crude surplus playing a crucial role in meeting this demand over the forecasted period.
“Despite the loss of Russian supply, the rest of the Atlantic Basin swings from roughly balanced in 2022 to a surplus of approximately 4.5 mb/d in 2028. The change reflects the continued surge in crude and condensate output as well as falling refinery runs. These trends lower the share of Atlantic Basin buyers of net world crude exports to around 25% over the forecast period and increase the concentration of those East of Suez,” the IEA noted in its 127-page report.
Despite rising global crude production and exports, China will account for one-third of worldwide traded volumes by 2028, with India accounting for another 17%. IEA said it estimates global oil demand to peak before the end of this decade as high prices and Russia’s invasion of Ukraine speed up the pace at which countries and industries move away from fossil fuels.
The medium-term report forecasts that global oil demand will rise by 6% between 2022 and 2028 backed by strong demand from the petrochemical and aviation sectors. However, while total oil demand will continue to grow through 2028, the pace of growth will progressively slow towards the end of the forecast period, after which peak demand is expected to be reached.
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Source: Splash247
