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Snapshot of global oil supply and demand: August 2021

Our dashboard explores key short-term signposts impacting oil demand, supply, and prices.

August 2021 saw volatile Brent crude prices as demand fluctuated with the continued spread of the Delta variant and supply suffering from disruptions caused by Hurricane Ida in the Gulf of Mexico. Fluctuations in short-term signposts compared to the prior month include:

  • Oil prices. Spot Brent was range bound in August, trading between $65-73/bbl, and averaging $71/bbl
  • Global oil demand. Oil demand increased slightly by 0.1 MMb/d m-o-m in August to 98.4MMb/d, mainly driven by North America. In China, demand declined by 0.8 MMb/d m-o-m to 14.16 MMb/d as some cities advised residents against non-essential travel following a new wave of COVID cases
  • Commercial inventories. Commercial inventories continue to decrease and are back to 5-year average levels at 4.4 Billion barrels globally as market balancing continues
  • OPEC 10 production (excl. Iran, Venezuela, Libya). OPEC 10 production increased by 0.1 MMb/d m-o-m. Iraq, Russia, Saudi Arabia, and the UAE saw the largest gains during the month, while Nigeria suffered a significant oil spill near a key export terminal that shut in production
  • Non-OPEC production (excl. US shale). Non-OPEC production stood at 56.6 MMb/d in August, down by 0.8 MMb/d m-o-m. US output saw the largest m-o-m decline of 0.56 MMb/d following disruptions caused by Hurricane Ida. Production in Kazakhstan decreased by -0.25 MMb/d m-o-m as projects underwent major field maintenance during the month
  • US shale oil production. US shale production remained relatively steady m-o-m at 8.04 MMb/d. Although production is up by 0.2 MMb/d y-o-y, it is still below pre-pandemic levels of >9 MMb/d as producers prioritize returns over higher output
  • Iran, Venezuela, Libya production. Production in Iran, Venezuela and Libya remained steady m-o-m at 2.5 MMb/d, 0.5 MMb/d and 1.2 MMb/d respectively
  • Market sentiment. Continued spread of the Delta variant has caused resurgence in COVID cases across many parts of the world, including China, dampening the recovery in global liquids demand. On the supply side, OPEC+ have agreed to increase output by a further two million barrels per day from August until December 2021, to help stabilize the market

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