KUWAIT, Sept 10 (KUNA) -- Supply shortages and intensifying turmoil in
Syria have helped push crude oil prices to 6-month highs, reaching USD 107 per
barrel last August, said a National Bank of Kuwait (NBK) report.
The report went on saying that much of the rise in prices appears to be
linked to supply issues. Output in OPEC members Iraq, Libya and Nigeria has
dropped considerably in recent months owing to a mixture of strikes, sabotage
and maintenance issues.
In combination with sanctions-affected Iranian output, the US-based Energy
Information Agency estimated that some 1.9 million barrels per day (bpd) of
OPEC output - or two of global supplies - was shut out in July.
In addition to supply issues, price pressures were also generated by
intensifying turmoil in the Middle East, notably in Egypt and Syria. Although
neither country is a major oil producer, there is potential for significant
spillover effects that could affect oil markets. The escalating war in Syria
and possible intervention by western military powers, for example, could stoke
sectarian conflicts in other MENA countries - especially Iraq.
The report indicated that analysts' forecasts for global oil demand growth
in 2013 have been revised up over the past couple of months. The International
Energy Agency (IEA) saw demand growing by 0.9 million bpd this year, or 1.0
percent, up from 0.8 million bpd in June and compared to 1.2 percent last
The Center for Global Energy Studies has revised its forecast up by an even
greater amount, from 0.7 million bpd in June to 1.0 million bpd. The stronger
outlook is linked to higher than expected demand levels for 2013 driven by a
cold weather snap in 2Q 13 in the northern hemisphere. Initial projections for
2014 show demand rising at the slightly faster pace of 1.1 million bpd,
reflecting an improvement in underlying global economic conditions. At these
types of levels, demand growth is close to its long-term trend.
Non-OPEC supplies are projected to increase by a large 1.4 million bpd in
2013, said the report. (end)
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