Forward Curves Of Oil Futures Reflect Optimistic Outlook For Global Economy -- OPEC

(MENAFN- Kuwait News Agency (KUNA)) VIENNA, Jan 15 (KUNA) -- The oil prices went up slightly in December, sending upbeat message about the outlook of the global economy, OPEC's latest report showed on Wednesday.
In December, the OPEC Reference Basket (ORB) rose by nine cents, or 0.1 percent, m-o-m, to average USD 73.07/b, according to OPEC Monthly Oil market Report January 2025.
The ICE (Intercontinental Exchange) brent front-month contract fell by 27 cents, or 0.4 percent, to average USD 73.13/b, while the NYMEX WTI front-month contract rose by 16 cents, or 0.2 percent, to average USD 69.70/b.
The GME (Gulf Mercantile Exchange) Oman front-month contract increased by 68 cents, or 0.9 percent, to average USD 73.16/b.
The ICE Brent-NYMEX WTI first-month spread contracted, m-o-m, falling by 43 cents to average USD 3.43/b.
The forward curves of oil futures prices strengthened, particularly for NYMEX WTI and GME Oman, with near-month time spreads shifting into a wider backwardation, reflecting a more optimistic outlook.
The market sentiment of hedge funds and other money managers turned positive, leading to the closing of a large volume of NYMEX WTI-related short positions, the report noted.
On the global economic growth, the reports forecasts that it will grow at 3.1 percent in 2025, accelerating slightly to 3.2 percent in 2026.
"This positive outlook is underpinned by anticipated inflation normalization and corresponding adjustments to monetary policies in major economies," the report reads.
The services sector is expected to remain the main driver of growth, supported by a gradual rebound in industrial production.
For the US, the economic growth forecast in 2025 is revised upward to 2.4 percent, with 2026 forecast at 2.3 percent.
In the Eurozone, the economic growth forecast for 2025 is revised slightly down to one percent, before rising to 1.1 percent in 2026.
Japan's economic growth forecast for 2025 remains at one percent and is projected to see similar growth in 2026.
China's economic growth forecast for 2025 remains at 4.7 percent, with the economic growth forecast for 2026 at 4.6 percent.
India's economic growth forecast is revised up to 6.5 percent for 2025 and is expected to expand to 6.8 percent in 2026.
Brazil's economic growth forecast for 2025 is revised up to 2.3 percent and is expected to rise further to 2.5 percent in 2026.
Russia's economic growth forecast for 2025 is revised up to 1.9 percent and is expected to grow by 1.5 percent in 2026.
Regarding the world oil demand, the report maintains its growth forecast for 2025 at 1.4 mb/d.
The OECD (Organization for Economic Co-operation and Development) is forecast to grow by about 0.1 mb/d, while the non-OECD is forecast to grow by about 1.3 mb/d.
"This robust oil demand growth is expected to continue in 2026. The global oil demand in 2026 is forecast to grow by 1.4 mb/d, y-o-y," it noted.
The OECD is forecast to grow by about 0.1 mb/d, y-o-y, while demand in the non-OECD is forecast to grow by about 1.3 mb/d.
Non-DoC liquids supply (i.e. liquids supply from countries not participating in the Declaration of Cooperation) in 2025 is forecast to grow by 1.1 mb/d, y-o-y, unchanged from last month's assessment.
The main growth drivers are expected to be the US, Brazil, Canada, and Norway.
The non-DoC liquids supply growth in 2026 is also forecast to grow by at 1.1 mb/d, mainly driven by the US, Brazil and Canada.
Meanwhile, natural gas liquids (NGLs) and non-conventional liquids from countries participating in the DoC are forecast to grow by about 90 tb/d, y-o-y, in 2025, to average 8.4 mb/d, followed by an increase of about 0.1 mb/d, y-o-y, in 2026 to average 8.5 mb/d.
Crude oil production by the countries participating in the DoC dropped by 14 tb/d in December, m-o-m, averaging about 40.65 mb/d, as reported by available secondary sources.
In December, refinery margins dropped in the US Gulf Coast (USGC) and Singapore.
Weakness was seen across the barrel, except for jet/kerosene on the USGC and gasoline (92) in Singapore, as healthy refinery runs led to rising product availability while weak export incentives added to the pressure.
However, in Rotterdam, refining margins extended their upward trajectory amid improved travel activities during the year-end holiday season, with gasoline, gasoil, and fuel oil (one percent Sulphur) backing the monthly gain.
Global refinery intake increased further adding 1.1 mb/d, m-o-m, as offline capacities trended significantly lower in December, in line with historic data.
Global intake reached an average of 82.2 mb/d in December, and was up slightly by 100 tb/d, y-o-y.
Demand for DoC crude (i.e. crude from countries participating in the DoC) in 2025 is revised down by around 0.1 mb/d from the previous month's assessment, mainly due to changes in 2024 historical baseline data, to stand at 42.5 mb/d, around 0.3 mb/d higher than the estimate for 2024.
It is worth highlighting again that growths in the global oil demand and non-DoC supply in 2025 remain unchanged as compared to last month.
For 2026, demand for DoC crude is expected to reach 42.7 mb/d, around 0.2 mb/d higher than in 2025. (end)
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