MOSCOW (MRC) -- Crude oil futures were steady during mid-morning Asian trade July 16, as increased certainty over the OPEC+ supply accord and robust demand projections from OPEC analysts arrested the plunge in oil prices thus far this week, reported S&P Global.
At 11:26 am Singapore time (0326 GMT), the ICE September Brent crude futures contract rose 2 cents/b (0.03%) from the previous close at USD73.49/b, while the NYMEX August light sweet crude contract was up 4 cents/b (0.06%) at USD71.69/b. The front month ICE Brent and NYMEX light sweet crude markers had fallen 3.94% and and 4.78% over July 13-15.
Reports have emerged that the impasse between the UAE and Saudi Arabia is on the verge of a resolution. Tensions between the two members of OPEC+, a coalition of OPEC and other oil producers, had flared after the UAE had objected to Saudi Arabia's plan to tie OPEC+ production increases to a lengthening of the supply management pact, insisting that its baseline production level, from which its quota is determined, be raised first.
Negotiations between the two seem to be heading towards an upward revision of the UAE's baseline production to 3.65 million b/d, from the current 3.168 million b/d, although this figure has yet to be ratified by other OPEC+ members.
The market also received some assurance from OPEC's July 15 monthly oil market report, in which OPEC analysts have kept their 2021 forecast for oil demand at 96.58 million b/d, up 5.95 million b/d from 2020. Furthermore, OPEC's analysts see demand growing by another 3.28 million b/d to 99.86 million b/d in 2022, expecting demand to top the 100 million b/d mark in the second half of the year. OPEC's robust demand outlook comes despite the spread of the more transmissible Delta variant of the coronavirus.
As MRC informed earlier, OPEC stuck to its forecast for a strong recovery in world oil demand in the rest of 2021 and predicted oil use would rise in 2022 at similar to pre-pandemic rates, led by growth in the United States, China and India.
We remind that China's crude oil imports fell 3% from January to June versus a year earlier, in the first first-half contraction since 2013, as an import quota shortage, refinery maintenance and rising global prices curbed buying. Imports totalled 40.14 million tonnes last month, data released by the General Administration of Customs showed on Tuesday, equivalent to 9.77 million barrels per day (bpd).
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 953,400 tonnes in the first five months of 2021, which virtually corresponded to the same figure a year earlier. High denisty polyethylene (HDPE) shipments decreased. At the same time, PP shipments to the Russian market were 607,8900 tonnes in January-May 2021, up by 33% year on year. Shipments of homopolymer PP and PP block copolymers increased, whereas deliveries of PP random copolymers decreased.