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Global Oil Supply & Demand Update For July 2023

Global Oil Supply & Demand Update For July 2023

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HFI Research
Jul 03, 2023
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HFI Research
HFI Research
Global Oil Supply & Demand Update For July 2023
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Well, well, well, we are now halfway through 2023 and the oil market is about to get a lot more exciting. There are 4 key themes we see going into year-end:

  1. Saudi's voluntary cut of ~1 million b/d.

  2. Russia's (new) voluntary cut announcement of 500k b/d. This brings their total to 1 million b/d.

  3. US shale oil production peaking into year-end.

  4. Global oil demand.

In our latest model update, we are assuming a few new assumptions:

  • US oil production peaking in Q3 at ~12.65 million b/d. We expect an exit of ~12.6 million b/d.

  • Russia's compliance is 50% putting production at ~10.5 million b/d vs 11 million b/d.

  • Saudi to maintain the voluntary production cut into year-end.

  • We continue to expect weak demand as a way of being conservative.

Because of the negative revision to US oil production and Russia, we now see a massive deficit taking place in Q4.

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