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/en/energi-og-industri/statistikker/ogintma/kvartal
33344
Continued increase in crude oil prices
statistikk
2007-01-11T10:00:00.000Z
Energy and manufacturing
en
ogintma, Oil and gas activities, international market conditions (discontinued), petroleum production, oil production, oil demand, oil prices, crude oil, brent blend, natural gas, condensate, NGLOil and gas , Energy and manufacturing
false

Oil and gas activities, international market conditions (discontinued), Q3 2006

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Continued increase in crude oil prices

The prices of Brent Blend fluctuated between USD 56 and USD 78 per barrel in the first nine months of 2006. This is the fifth consecutive year of rising oil prices.

The record high prices were mainly a result of significant and continued disruptions to crude oil supplies, low levels of global spare production capacity and elevated geopolitical concerns surrounding Iran's nuclear programme.

Brent Blend

The average Brent Blend spot price in the third quarter of 2006 was USD 68.71/bbl against USD 69.39/bbl in the second quarter. In the first nine months of 2006 the average price was a record USD 66.65/bbl. The average price in 2006 was USD 64.72/bbl against USD 54.50/bbl in 2005.

From 30 December to 30 January the Brent Blend price increased from USD 58.69/bbl to USD 65.08/bbl due to actual and potential disruptions to crude oil supplies. Outages in supply came in Nigeria, the North Sea and Australia. Russian supplies fell due to low temperatures which affected the logistics and Iraqi export remained weak. In addition, Iranian nuclear issues concerned the oil market.

At their meeting on 31 January 2006, OPEC decided not to change their production quota. This decision was in line with market expectations and did not have a substantial effect on oil prices.

Increasing petroleum stocks led to price fall

From 1 February to 16 February the Brent Blend price decreased from USD 65.67/bbl to USD 56.07/bbl due to increasing petroleum stocks in USA. In addition, the oil market was less worried that the UN would carry out economic sanctions against Iran in near future. Oil prices rebounded thereafter. A sustained disruption to Nigerian supplies turned the market around. Militant attacks interrupted almost 0.5 million barrels a day of supply. On 28 February the Brent Blend price had increased to USD 58.87/bbl.

From 1 March to 30 March the Brent Blend price remained relatively stable around USD 60/bbl. On 30 March the price jumped almost USD 4/bbl to USD 66.19/bbl, due to further disruption to Nigerian crude supplies and returning geopolitical tensions surrounding the Iranian nuclear programme.

Sharp increase from March to May

The crude prices continued to make strong gains in April. The Brent Blend averaged at USD 70.66/bbl in April - USD 9.40/bbl higher than in March. The gain was led by a sharp rise in gasoline prices along with stronger political rhetoric from Iran. The increase came against a backdrop of continued disruption to Nigerian supplies and low spare production capacity. In addition, economic data showed higher than expected economic first quarter growth in the leading oil consumer countries, USA and China.

From 2 May to 22 May the Brent Blend price decreased from a record high USD 74.99/bbl to USD 65.86/bbl. The decline was due to expectations that inflationary pressures would lead to a further tightening in monetary condition and weaken the global economy and oil demand. In addition, the output from the Gulf of Mexico recovered with the return of the Mars platform.

Strong gasoline prices and refinery problems

Brent Blend crude oil prices were relatively flat from mid May to mid June, before rising sharply towards the end of June. The increase was driven by strong gasoline prices, refinery problems, remained supply constraints in Nigeria and geopolitical worries surrounding Iran's nuclear programme.

In the third quarter the oil prices showed a further gain before decreasing in mid August. The average Brent Blend in July came to USD 73.46/bbl and reached a record high of USD 78.46/bbl on 9 August. The high prices were driven by increased disruptions to crude oil supplies along with elevated geopolitical concerns surrounding Iran's nuclear programme and the war in Lebanon. The oil market also feared the North Atlantic hurricane season approaching.

From 9 August to 15 September the Brent Blend crude oil price fell by USD 18.69/bbl to USD 59.77/bbl, due to decreasing gasoline prices, improvements in crude supplies, downward revised hurricane forecasts and ceasefire in Lebanon. In addition, the members of the UN Security Council have not agreed on sanctions against Iran. The Brent Blend averaged at USD 61.19/bbl in September - USD 11.39/bbl lower than in August.

Global production of crude oil

According to the International Energy Association (IEA) Monthly Oil Market Report, the global production of crude oil came to 85.2 million barrels a day in the first nine months of 2006. This is an increase of 0.8 million barrels a day compared with the corresponding period in 2005.

The total non-OPEC production in 2006 is estimated at 50.9 million barrels a day by the IEA. This is an increase of 0.6 million barrels a day compared with the actual non-OPEC production in 2005.

The total non-OPEC production in 2007 is estimated at 52.6 million barrels a day by the IEA.

Global demand for crude oil

According to the IEA Monthly Oil Market Report, the global demand for crude oil came to 84.4 million barrels a day in the first nine months of 2006. This is an increase of 0.5 million barrels a day compared with the corresponding period in 2005.

The global crude oil demand in 2007 is estimated at 85.9 million barrels a day by the IEA.

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