Brent crude oil prices decreased by USD0.6/bbl m-o-m to USD74.8/bbl in June despite demand outstripping supply by 0.7 MMb/d. US and Europe economic recovery weakened in June as manufacturing activity contracted. Changes in June compared to the prior month include:
- Global oil demand. Global liquids demand increased by 1.6 MMb/d in June to 102 MMb/d. Strong gains in Europe (+0.6 MMb/d) and the Middle East (+0.5 MMb/d) accounted for the majority of the demand growth
- OPEC 10 production (excl. Iran, Venezuela, Libya). OPEC 10 production increased by 0.2 MMb/d m-o-m to 29.0 MMb/d in June. Saudi Arabia’s production during the month increased by 0.15 MMb/d to 10.1 MMb/d, after declining by 0.7 MMb/d the previous month
- Non-OPEC production (excl. US shale). Non-OPEC production increased by 0.4 MMb/d in June to 58.3 MMb/d driven by supply increases primarily in Brazil (~0.2 MMb/d) and Canada (~0.1 MMb/d). Russian production remained steady at 10.5 MMb/d in June
- US shale oil production. US shale oil production remained stable at 9.4 MMb/d in June. The number of active rigs has continued to decline m-o-m to 616 during June (down by 83 since the start of 2023)
- Iran, Venezuela, Libya production. Combined production levels in Iran, Venezuela, and Libya remained stable at 4.7 MMb/d in June
- Commercial inventories. Global commercial inventories declined by 19 million barrels in June to 4.56 billion barrels, the first withdrawal since February 2023. Most of the decline came from non-OECD inventories
- Market sentiment. On the supply side, Saudi Arabia announced additional voluntary cuts of 1 MMb/d in July and August, Russia announced 500Kb/d voluntary output cuts on top of the 500Kb/d pledged in March. Overall, economic sentiment remains uncertain, and demand concerns remain due to weaker economic data from US and Europe