The world oil market is undergoing a huge transformation
Recently, the International Energy Agency, the International Petroleum Economics Monthly and the Shanghai International Energy Education Center jointly released the Oil Market Report 2019. The report pointed out that the current world oil market is undergoing a great transformation. In the next five years, the United States will lead the growth of global oil supply. In 2021, it will become a net exporter of oil. At the same time, the refining and chemical industry will encounter the biggest adjustment in history.
US oil production in 2024 is comparable to Saudi Arabia and Russia
The report pointed out that on the supply side, the US oil supply increase in 2018 was 2.2 million barrels per day, a record high. It is estimated that by 2024, the US oil supply will increase to 4 million barrels per day, accounting for 70% of the global increase. The report predicts that the United States will become a net exporter of oil in 2021, and US oil exports will surpass Russia in 2024, close to Saudi Arabia. Overall, the United States is leading the global oil supply growth. By 2024, non-OPEC oil production will increase by 6.1 million barrels per day.
On the demand side, global oil demand growth will slow down, but the average annual growth rate will still reach 1.2 million barrels per day, and oil demand in major developing economies will continue to increase. The report believes that by 2024, world oil demand will continue to grow by 7.1 million barrels per day, when China and India will account for 44% of the global increase in oil consumption.
According to the report, economic restructuring and environmental protection policies have led to a slowdown in China's oil demand growth. Despite the recent slowdown in China's economic growth, GDP has doubled in the past 10 years and is still growing steadily. China’s national income has risen sharply, leading to a shift in the focus of oil consumption from heavy industry to consumer demand. Although India's per capita GDP is only one-fifth of China's, its growth momentum is strong. The report predicts that by 2024, India's oil demand growth will be comparable to China's.
Neil Atkinson, head of the oil industry and marketing department at the International Energy Agency, believes that although upstream investment has increased again in 2019, more investment is needed. In the long run, global oil supply security depends on investments in existing conventional oil projects. The initial investment plans of major international oil companies show that upstream investment will increase for the third consecutive year in 2019. Since the investment decline in 2015, the investment growth rate of conventional assets may exceed shale oil and gas assets for the first time.
Shan Lianwen, deputy dean of China National Offshore Oil and Gas Research Institute, believes that the key point for the future global oil increase is the US shale oil. When the US shale oil revolution enters the era of large corporate system, the price will tend to be stable and fluctuating. The situation will be reduced accordingly.
The refining and chemical industry will become the pillar of demand growth
The report predicts that the petrochemical and aviation industries are the two pillars of oil demand growth, and oil demand growth continues to shift from advanced economies and transportation fuels to Asian and petrochemical products.
Refining companies will face the dual challenges of capacity expansion and changes in crude oil and oil quality. The report predicts that the refining industry will face a large new capacity by 2024, with a net increase in refining capacity of approximately 9 million barrels per day. China will surpass the United States as the country with the strongest refining capacity in the world. Given that these new capacity far exceeds the growth in oil demand, some refineries may need to close to rebalance the market.
Ke Xiaoming, deputy chief engineer of the China Petrochemical Economic and Technological Research Institute, analyzed that although various institutions have different research and conclusions on the growth of oil demand, it is certain that the growth rate of oil demand is slowing down significantly. He believes that there is uncertainty in whether oil demand peaks. On the one hand, in the actual car increments in recent years, large-displacement vehicles such as SUVs have increased more; on the other hand, the safety technology development of electric vehicles is not mature enough. , affect sales.
Regarding the issue of changes in the structure of oil consumption, Ke Xiaoming said that many refineries in China are considering the issue of transformational development and high-quality development, but the future transformation may encounter three difficulties. First, capacity replacement, new capacity construction will eliminate some of the backward production capacity; second, the company's own transformation and development; third, to increase the export volume of competitive products.
The refining industry will encounter the biggest adjustment in history
The report analyzes that in the downstream industry, with the implementation of the International Maritime Organization (IMO) rules, the oil market is about to usher in the largest adjustment ever. The new regulations stipulate that the maximum sulfur content allowed for marine fuels will be reduced from 2020. Although the shipping and refining industry has been notified several years in advance, the market will still tighten in the early days of the new regulations. As demand in the maritime industry increases, diesel prices may initially rise, but weak demand for inland diesel will limit price increases.
Shan Lianwen believes that the recent new IMO regulations have a great impact on the entire marine oil market. Low-sulfur fuel oil and marine diesel may have good market opportunities, which is both an opportunity and a challenge for industry participants. .
Dai Jiaquan, director of the Petroleum Market Research Institute of China Petroleum and Economics Research Institute, believes that the growth of US gasoline supply in 2018 exceeds the growth of global gasoline demand, resulting in the reduction of production alliances to reduce production to maintain the global market balance, while the current international market does not It will be in short supply due to the tension of international relations. From the perspective of the whole year, the global oil supply is sufficient, especially the most important transportation bottleneck restricting the growth of US crude oil in the second half of this year, that is, more than 2 million tons/day of pipe production is about to be put into production, so the global oil market is not There is a shortage of supply, and even if international relations are relatively tight, the impact on the market is not as big as it might be.