Summary
Crude Oil Price Movements
In January, the OPEC Reference Basket (ORB) increased by $6.31, or 8.6%, m-o-m, to average $79.38/b. The ICE Brent front-month contract rose $5.22, or 7.1%, to average $78.35/b, while the NYMEX WTI front-month contract gained $5.40, or 7.7%, to average $75.10/b. The GME Oman front-month contract increased by $7.14, or 9.8%, m-o-m, to average $80.22/b. The ICE Brent-NYMEX WTI first-month spread contracted by 18¢, m-o-m, to average $3.25/b. Among major crude benchmarks, Dubai and GME Oman showed the most significant strengthening in price structure, outpacing Brent and WTI. Hedge funds and other money managers sharply increased their net long positions in ICE Brent along with substantial financial flows.
World Economy
The world economic growth forecasts remain unchanged at 3.1% for 2025 and 3.2% for 2026. The US growth forecast is unchanged at 2.4% for 2025 and 2.3% for 2026. Japan’s growth forecasts stand at 1.0% for both 2025 and 2026, unchanged from the previous month’s assessment. Eurozone economic growth for 2025 is revised down slightly and projected at 0.9% and is forecast to rise to 1.1% in 2026. China’s economic growth forecast for 2025 remains at 4.7% with a slight deceleration to 4.6% in 2026. India’s economic growth forecasts remain at 6.5% for both 2025 and 2026. Brazil’s economic growth forecasts remain at 2.3% in 2025 and 2.5% in 2026. Russia’s economic growth forecasts for 2025 and 2026 are unchanged at 1.9% and 1.5%, respectively.
World Oil Demand
The global oil demand growth forecast for 2025 remains unchanged at 1.4 mb/d. The OECD is projected to grow by about 0.1 mb/d, y-o-y, 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. Global oil demand for 2026 is forecast to grow by 1.4 mb/d, y-o-y, unchanged from last month’s assessment. 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.
World Oil Supply
Non-DoC liquids supply (i.e. liquids supply from countries not participating in the Declaration of Cooperation) is forecast to grow by 1.0 mb/d, y-o-y, in 2025, revised down by 0.1 mb/d from last month’s assessment. The main growth drivers are expected to be the US, Brazil, Canada, and Norway. Non-DoC liquids supply growth in 2026 is also forecast at 1.0 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 80 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 decreased by 118 tb/d in January, m-o-m, averaging about 40.62 mb/d, as reported by available secondary sources.
Product Markets and Refining Operations
In January, refinery margins rose on the US Gulf Coast (USGC) as the recent refinery outages due to winter storms and refinery maintenance ramp-ups weighed on refinery product output. This coupled with robust US product exports in January resulted in gains in all parts of the barrel except for fuel oil. In contrast, margins declined both in Rotterdam and Singapore as stronger feedstock prices and high freight rates contributed to subdued product outflows. This placed added pressure on product crack performance in both regions except for middle distillates in Europe. Global refinery intake In January declined 1.0 mb/d, m-o-m, to average 81.3 mb/d, due to refinery outages amid severe weather in the US. However, compared to the same month last year, global intake rose was 750 tb/d higher.
Tanker Market
Dirty spot freight rates registered a slow start to the year. VLCCs showed the best performance in January, with the Middle East-to-East route up 38%, m-o-m, amid more activities on the longer haul routes. The Suezmax and Aframax markets fared less well, amid more muted activity due to renewed trade uncertainties. Suezmax rates on the US Gulf Coast-to-Europe route declined by 11%, m-o-m, while Aframax spot rates around the Mediterranean fell by 18%, m-o-m. In the clean tanker market, East of Suez rates rose by 20%, m-o-m, on average, while West of Suez rates fell by 5%, m-o-m.
Crude and Refined Products Trade
Available data for January shows US crude imports starting the year slightly above the previous five-year average at 6.4 mb/d. US crude exports came in just below 4 mb/d, despite icy weather in the shale-producing regions and the US Gulf Coast. US product imports fell 2%, with declines led by gasoline. Preliminary estimates for OECD Europe indicate crude imports in January were lower both m-o-m and y-o-y, as reduced flows to the Netherlands and France outweighed higher imports into the UK and Italy. OECD Europe product exports were down, amid reduced flows to Africa. Complete data for 2024 shows Japan’s crude imports declined by about 9% last year, amid muted economic activity, particularly in the first half of the year. Japan’s product imports were broadly unchanged, as a pickup in demand in the latter part of 2024 avoided a decline. In China, crude imports showed a decline in 2024, averaging 11.0 mb/d. In contrast, China’s product imports marked a fresh record high, supported by refinery and petrochemical feedstock demand. India’s crude and product imports recorded fresh record highs in 2024, averaging 4.8 mb/d and 1.2 mb/d, respectively. Higher inflows were supported by a healthy economy, as well as election activities at the start of the year. India’s product exports also edged higher.
Commercial Stock Movements
Preliminary December 2024 data shows total OECD commercial oil stocks up by 4.3 mb, m-o-m. At 2,754 mb, they were 172.1 mb below the 2015–2019 average. Within the components, crude stocks went down by 0.8 mb, while products stocks rose by 5.1 mb, m-o-m. OECD commercial crude stocks stood at 1,307 mb, which is 120.7 mb less than the 2015–2019 average. OECD total product stocks stood at 1,447 mb, 51.4 mb below the 2015–2019 average. In terms of days of forward cover, OECD commercial stocks rose by 0.9 days, m-o-m, in December to stand at 61.3 days, which is 1.1 days lower than the 2015–2019 average.
Balance of Supply and Demand
Demand for DoC crude (i.e. crude from countries participating in the DoC) in 2025 is revised up by around 0.1 mb/d from the previous month’s assessment, to stand at 42.6 mb/d, about 0.4 mb/d higher than the estimate for 2024. For 2026, demand for DoC crude is revised up by around 0.2 mb/d from the previous month’s assessment, to stand at 42.9 mb/d, about 0.3 mb/d higher than the forecast for 2025.