Jim Wu
This week’s chart from Deutsche Bank shows China and India’s share
of global oil demand has increased 67 percent since 2002. This year,
Chindia’s combined total accounts for 15 percent of global demand.
While demand growth has remained flat in the developed world in 2010, DB estimates that Asian oil demand (excluding Japan) is up 8 percent compared with the same time period last year.
China’s demand growth during the first half of the
year outpaced what many had forecast, jumping 12 percent from January
to July. India’s pace has been slower (up 3 percent year-to-date) but
an 8 percent rise in demand for refined products like gasoline and
diesel fuel reflects the country’s economic vitality, according to DB.
These developments are a catalyst for higher oil
prices but Credit Suisse cautions that Chinese demand could soften in
the back half of this year and into 2011 due to Beijing’s measures to
slow the country’s economic growth. CS is forecasting China’s GDP
growth to average 8.6 percent over the next four quarters, well below
the 11.1 percent the country averaged during the first half of 2010.
With less economic activity, the pace of Chinese demand growth should
slow.
India’s oil demand growth also looks to be flattening out. The International Monetary Fund is forecasting the country’s oil demand will drop by 200,000 barrels per day during the second half of 2010.
Despite these immediate headwinds, the long-term
supply/demand story for oil remains one of diminishing supply and
growing demand. With emerging markets continuing to grow at a robust
pace, there will be more people using more oil in more ways—a strong
tailwind for higher prices.
After falling during the first half of 2009, global
oil demand rose 2.25 million barrels per day during the first six
months of 2010. The oil demand story continues to be driven by
emerging markets, especially China and India.
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This week’s chart from Deutsche Bank shows China and
India’s share of global oil demand has increased 67 percent since
2002. This year, Chindia’s combined total accounts for 15 percent of
global demand.
While demand growth has remained flat in the developed world in 2010, DB estimates that Asian oil demand (excluding Japan) is up 8 percent compared with the same time period last year.
China’s demand growth during the first half of the
year outpaced what many had forecast, jumping 12 percent from January
to July. India’s pace has been slower (up 3 percent year-to-date) but
an 8 percent rise in demand for refined products like gasoline and
diesel fuel reflects the country’s economic vitality, according to DB.
These developments are a catalyst for higher oil
prices but Credit Suisse cautions that Chinese demand could soften in
the back half of this year and into 2011 due to Beijing’s measures to
slow the country’s economic growth. CS is forecasting China’s GDP
growth to average 8.6 percent over the next four quarters, well below
the 11.1 percent the country averaged during the first half of 2010.
With less economic activity, the pace of Chinese demand growth should
slow.
India’s oil demand growth also looks to be flattening out. The International Monetary Fund is forecasting the country’s oil demand will drop by 200,000 barrels per day during the second half of 2010.
Despite these immediate headwinds, the long-term
supply/demand story for oil remains one of diminishing supply and
growing demand. With emerging markets continuing to grow at a robust
pace, there will be more people using more oil in more ways—a strong
tailwind for higher prices.
After falling during the first half of 2009, global
oil demand rose 2.25 million barrels per day during the first six
months of 2010. The oil demand story continues to be driven by
emerging markets, especially China and India.
Back to crusher page
Related Products:
|
|
|