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  4. WOO launched at ADIPEC 2016

WOO launched at ADIPEC 2016

Published by , Editorial Assistant
Oilfield Technology,

The 2016 OPEC World Oil Outlook (WOO) was launched at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) 2016 in the United Arab Emirates (UAE). This year is the tenth edition of the WOO, a significant milestone for OPEC’s flagship publication, which offers a thorough review and assessment of various scenarios related to the medium- and long-term development of the upstream and downstream sectors of the oil industry.

In introducing the publication, His Excellency Mohammad Sanusi Barkindo said: “In general, the WOO 2016 underlines the increasingly complex nature of the oil industry, both in the upstream and downstream; the market adjustments that have taken place since the price drop that began in mid-2014; the continued interdependence of all nations; how security of supply and security of demand are very much interlinked; and the need to better understand the market drivers, challenges, uncertainties, as well as opportunities, we face.”

In this year’s WOO, it is again essential to emphasise that given the ever-shifting dynamics of the current global oil market, alongside the need to freeze the Outlook’s modelling processes and certain assumptions by mid-year 2016, some of the short-term numbers will have naturally shifted to reflect the fast changing fundamentals. For the Organisation’s most up-to-date numbers for 2016 and 2017, please see OPEC’s latest Monthly Oil Market Report: http://www.opec.org/opec_web/en/publications/338.htm.

However, the medium- to long-term analysis and trends from this year’s WOO remain relevant. Some specific highlights from this year’s publication include:

  • Total primary energy demand is set to increase by 40% in the period to 2040.
  • Combined, oil and gas are expected to supply around 53% of the global energy demand by 2040.
  • The outlook for the long-term global economic growth rate to 2040 is at 3.5% per annum, the same as the WOO 2015.
  • Medium-term oil demand is revised upward by 1 million bpd), compared to the WOO 2015, rising above 99 million bpd by 2021.
  • Long-term oil demand is revised slightly downwards by 0.4 million bpd, with total demand at over 109 million bpd by 2040.
  • Developing countries will continue to lead demand growth, increasing by close to 25 million bpd, to reach over 66 million bpd by 2040.
  • Long-term demand growth comes mainly from the road transportation (6.2 million bpd), petrochemicals (3.4 million bpd) and aviation (2.8 million bpd) sectors.
  • Oil demand in the road transportation sector is driven by the increasing car fleet in Developing countries and declining oil use per vehicle in the OECD region.
  • Non-OPEC liquids supply is expected to drop from close to 57 million bpd in 2015 to just below 56 million bpd in 2017, before recovering slowly to just over 58.5 million bpd in 2021.
  • In the long-term, non-OPEC liquids output is anticipated to see a slow rise to just under 61.5 million bpd by 2027, before dropping to just under 59 million bpd by 2040.
  • The demand for OPEC crude expands to 41 million bpd by 2040, with the estimated share of OPEC crude in total liquids supply increasing to 37%, from 34% in 2015.
  • New refining capacity continues to follow demand growth to developing regions, led by the Asia-Pacific, which is projected to add 9.5 million bpd by 2040.
  • Capacity rationalisation remains a long-term requirement, with some 2.5 million bpd of net refinery closures expected by 2040, an estimated 4 million bpd by 2025, and a further 5 million bpd are indicated as needed by 2040 if refining regions are to maintain utilisation rates of at least 80%.
  • The primary trend in long-term oil trade is expanding crude imports into the Asia-Pacific from the Middle East, with an expected addition of 6.5 million bpd by 2040.
  • At the global level, oil-related investment required to cover future demand for oil over the forecast period 2016–2040 is estimated at almost US$10 trillion (in 2015 dollars).
  • The future tightening of climate change policies will likely lead to reduced energy demand and a further shift in the energy mix towards renewables.

    • It is important to stress that the WOO is not about making predictions. The Outlook should be viewed as a tool of reference to stimulate discussion and debate among all industry stakeholders. HE Barkindo said that OPEC believes that this publication evidently demonstrates this and underscored that it is not only the result of close collaboration and coordination between the Secretariat and Member Countries, but also a sign of OPEC’s ongoing commitment to dialogue as a means to help secure a sound and stable oil industry.

     

    HE Barkindo also added that he was proud to see the publication launched in an OPEC Member Country for the first time, and thanked the Government of the United Arab Emirates, its Energy Ministry, the organisers of ADIPEC, and all the OPEC Secretariat staff involved in putting together the WOO 2016.

     

    Following the successful launch of the interactive version of the WOO in 2014 and its follow up in 2015, a more comprehensive interactive version will be made available this year. This can be accessed at the following link: http://www.opec.org/opec_web/en/publications/340.htm.

    Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/10112016/woo-launched-at-adipec-2016/

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