IEA FORECASTS SLOWER GROWTH IN OECD OIL DEMAND
Growth in oil consumption in the Western
industrialized countries is likely to slow to around one pct
this year compared with 2.3 pct in 1986, the International
Energy Agency said.
    Oil use in the 24 member countries of the Organization for
Economic Cooperation and Development (OECD) increased by around
one pct in the first quarter of 1987 to 35.9 mln barrels a day,
the IEA said in its latest monthly report.
    Growth in OECD countries is expected to come primarily from
transport fuels, as was the case in 1986. But if average
consumer prices are higher than 1986, the rate of growth for
these fuels may be below last year's 3.6 pct.
    The IEA said assuming crude and product prices remain nar
current levels, some destocking by end-users can be expected.
    If that takes place, natural gas will also regain some of
the market share it lost to heavy fuel in 1986, it said.
    IEA estimates on April one put oil stocks held in the OECD
area at 428 mln tonnes, or 98 days of forward consumption. This
is about the same as at the begining of the year.
    The agency said this flat trend is explained by the
projected seasonal consumption decline in the second quarter of
the year which offset a reduction in stocks.
    Company stocks on land in the OECD rose to 326 mln tonnes
on April one this year compared with 316 mln tonnes in calender
1986 while governments also built up their strategic stocks to
102 mln tonnes against 97 mln in 1986.
    The year-on-year trend of government stock building is
continuing with company stocks rising, more or less in line
with consumption, after declining for five years, IEA said.
    Oil stocks on land in the United States and Canada were put
at 206.6 mln tonnes down from the 214 mln tonnes on January one
and equivalent to 94 and 98 days of consumption, respectively.
    Oil stocks in Western Europe were 147.4 mln tonnes, down
from the 154 mln tonnes on January one but still equivalent to
94 days of consumption.
    The IEA said that initial estimates indicate that company
stocks fell by 1.2 mln bpd in OECD countries in the first
quarter of the year. This followed a small rise in January of
400,000 bpd but a decline of 1.5 bpd in February and 2.5 bpd in
March.
    And it is possible that final data will show a larger draw,
particulary for March, it said.
    As crude production also fell, there is likely to have also
been a decline in non-reported stocks, particularly at sea, the
IEA said.
    World oil supply fell through the first quarter by about
two bpd to 45.2 bpd from 47.5 bpd in the last quarter of 1986.
    This drop was mostly due to a decline in OPEC crude
production to around 15.5 bpd in February/March from 16.5 bpd
in January and to the seasonal drop in exports from Centrally
Planned Economies, the IEA said.
    Total OPEC oil supply totalled 17.2 bpd in the first
quarter of 1987 compare with 19.3 bpd in the last three months
of 1986 while supply from non-OPEC countries totalled 28 bpd as
against 28.2 bpd in the same 1986 period.
    A drop in Saudi Arabian output to a tentatively forecast
3.3 bpd in march from 3.6 bpd in February was the largest
factor behind the OPEC production decline, the IEA said.
 Reuter
