IEA Oil Market Dec 09 Report

11 December 2009
HIGHLIGHTS

• Forecast global oil demand is virtually unchanged for 2009 at
84.9 mb/d but is revised up by 130 kb/d to 86.3 mb/d in 2010. Yearly
growth (‐1.4 mb/d and +1.5 mb/d, respectively) remains driven by non‐
OECD countries, but OECD prospects have slightly improved.
• OECD industry stocks fell by 36 mb in October to 2,735 mb, 2.5%
above 2008’s level. Middle distillates accounted for over 40% of the
draw, yet global products in floating storage continued to rise in
October and November. End‐October forward demand cover fell to
59.4 days, 2.5 days higher than a year ago.
• Global oil supply rose by 200 kb/d in November. OPEC crude
production increased by 135 kb/d to 29.1 mb/d, its highest level in a
year. Largely as a result of lower non‐OPEC supply prospects for 2010,
next year’s call on OPEC is raised by 0.5 mb/d to 29.0 mb/d, compared
with 28.7 mb/d in 2009.
• Forecast 2009 non‐OPEC supply is raised by 125 kb/d to 51.3 mb/d as
Russian gas liquids output is revised up. In addition, the end of the
quietest US hurricane season since 1997 has contributed to lift this
year’s outlook. By contrast, 2010 supply is revised down by 265 kb/d
to 51.6 mb/d, with North American supply now lower.
• Projected global 4Q09 refinery crude throughput is revised down by
0.6 mb/d to 72.3 mb/d, due to weaker US preliminary data and
higher maintenance in Asia and the Middle East. Global 1Q10 crude
throughput is seen rising by 1.0 mb/d year‐on‐year to 72.7 mb/d, but
OECD crude runs are expected to fall given weak refining margins.
• Crude oil futures prices traded in a higher $75‐80/bbl range in
November before weakening in early December on fears that the
recovery in the global economy could be shallower and slower than
expected, especially in the key US market. Prices were trading at eight‐
week lows of around a $70‐74/bbl range at the time of writing.
• A medium‐term market update sees upward revisions for demand
(largely non‐OECD Asia) outstripping those for supply (Russia, OPEC NGLs
and Nigerian and Iraqi capacity). Yet higher OPEC capacity ensures similar
market outlooks – tightening under the higher GDP case, but remaining
comfortable under lower GDP growth or faster efficiency gains.

TABLE OF CONTENTS

HIGHLIGHTS....................................................................................................................................................................................... 1
REVIEWING THE MEDIUM-TERM HORIZON .......................................................................................................................... 3

Oil Demand ..................................................................................................................................................................................... 3
Oil Supply ......................................................................................................................................................................................... 4
Biofuels ............................................................................................................................................................................................. 5
Refining ............................................................................................................................................................................................. 5
Oil Market Balances ....................................................................................................................................................................... 6
DEMAND ............................................................................................................................................................................................. 8
Summary........................................................................................................................................................................................... 8
Medium-Term Demand Update .................................................................................................................................................. 9
OECD ............................................................................................................................................................................................. 10
North America ........................................................................................................................................................................ 11
Another Source of Uncertainty............................................................................................................................................ 13
Europe ....................................................................................................................................................................................... 14
Pacific ......................................................................................................................................................................................... 16
Non-OECD ................................................................................................................................................................................... 17
China .......................................................................................................................................................................................... 17
Who’s (Not) Driving?............................................................................................................................................................. 18
Other Non-OECD.................................................................................................................................................................. 19
SUPPLY ................................................................................................................................................................................................ 21
Summary......................................................................................................................................................................................... 21
OPEC Crude Oil Supply ............................................................................................................................................................. 22
Medium-Term OPEC Capacity Update: Nigeria and Iraq Key to Stronger Increases ................................................. 23
Non-OPEC Overview ................................................................................................................................................................. 25
Medium-Term Non-OPEC Supply Update: Higher Baseline, More Optimistic Outlook ............................................ 26
OECD ............................................................................................................................................................................................. 27
North America ........................................................................................................................................................................ 27
Better Biofuels Prospects in the Medium Term .................................................................................................................... 28
North Sea.................................................................................................................................................................................. 29
Former Soviet Union (FSU) ....................................................................................................................................................... 29
Other Non-OPEC........................................................................................................................................................................ 31
OECD STOCKS ................................................................................................................................................................................ 32
Summary......................................................................................................................................................................................... 32
OECD Stock Position at End-October and Revisions to Preliminary Data ........................................................... 32
Analysis of Recent OECD Industry Stock Changes .............................................................................................................. 33
OECD North America........................................................................................................................................................... 33
OECD Europe.......................................................................................................................................................................... 34
OECD Pacific ........................................................................................................................................................................... 35
Recent Developments in Singapore Stocks ............................................................................................................................ 36
PRICES ................................................................................................................................................................................................. 38
Summary......................................................................................................................................................................................... 38
Market Overview ......................................................................................................................................................................... 38
Futures ............................................................................................................................................................................................ 39
Spot Crude Oil Prices ................................................................................................................................................................. 40
Spot Product Prices ..................................................................................................................................................................... 41
Refining Margins ............................................................................................................................................................................ 42
End-User Product Prices in November ................................................................................................................................... 43
Freight ............................................................................................................................................................................................. 44
REFINING ........................................................................................................................................................................................... 45
Summary......................................................................................................................................................................................... 45
Global Refinery Overview .......................................................................................................................................................... 45
Medium-Term Refinery Capacity Growth Projections Bounce .................................................................................... 46
Global Refinery Throughput ...................................................................................................................................................... 47
OECD Refinery Throughput...................................................................................................................................................... 48
Non-OECD Refinery Throughput ............................................................................................................................................ 50
OECD Refinery Yields ................................................................................................................................................................ 51
TABLES................................................................................................................................................................................................ 53
I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT M ARKET O VERVIEW
REVIEWING THE MEDIUM-TERM HORIZON

The December OMR contains not only the customary review and projections through 2010, but also a
preliminary update of June’s MTOMR outlook to 2014. Our short‐term balance looks marginally tighter
for 2010 than last month, with lower non‐OPEC supply giving an underlying ‘call on OPEC crude and stock
change’ which now rises in 2010 to 29 mb/d. The medium‐term outlook also sees a stronger ‘call’ compared
with the June MTOMR, alongside slightly tighter spare capacity in the higher GDP case. We summarise key
features of the medium‐term update below, and individual OMR sections discuss MTOMR revision specifics.
An interim update will be a regular feature of the MTOMR cycle, published within the OMR. June 2010 will
see the next full medium‐term report. The exercise here focuses on baseline data changes, updated
GDP/price assumptions and revised upstream/downstream project schedules. An MTOMR data appendix
will be available for subscribers later in December and, as ever, we welcome your comments.

Oil Demand
Adjustments to the outlook result in average
2009‐2014 demand around 1.9 mb/d higher than m b/d Global Oil Product Demand
92
in June’s report. A higher 2009 baseline, partly from 91 June 2009 MTOMR
the impact of economic and fiscal stimulus 90
With Baseline & GDP Revisions
programmes (notably for the non‐OECD), and 89
as of Decem ber 2009
stronger assumed 2009/2010 GDP growth underpin 88
this upgrade. Our higher GDP case hinges on the 87
IMF’s October 2009 outlook, which sees more front‐ 86
85
end loaded recovery than last time, but with the
84
global economy again regaining trend growth
83
around 4.5% later in the forecast. Assumed crude 82
prices follow the futures strip as at early December 2007 2008 2009 2010 2011 2012 2013 2014
2009, equating to $80/bbl (nominal) by mid‐decade,
compared with the $70/bbl assumed last time. The higher GDP case generates annual average demand
growth of 1.2 mb/d (+1.4%) from 2009 onwards, taking world demand close to 91 mb/d by 2014. All of the
growth comes from the non‐OECD, which overtakes the OECD to account for 51% of world demand by 2014.
Of course, much dust still has to settle in the aftermath of the 2008 economic meltdown, but our working
assumption remains that a degree of structural demand destruction has occurred, notably in the OECD, which
may constrain overall levels of demand growth in future. After the economic hiatus of 2009 and 2010,
ongoing declines in oil intensity (tighter fuel economy standards, industry restructuring and gas‐for‐oil
substitution) are assumed.
Demand Scenarios
(millio n barrels per day)
Avg. Yearly Grow th, Avg. Yearly Grow th,

2008 2009 2010 2011 2012 2013 2014 2008-2014 2009-2014
% m b/d % m b/d
Higher GDP
Global GDP (y-o-y chg) 2.9% -1.2% 3.1% 4.2% 4.4% 4.5% 4.5% 3.2% 3.2%
OECD 47.6 45.5 45.5 45.4 45.2 45.0 44.8 -1.0% -0.45 -0.3% -0.14
Non-OECD 38.6 39.3 40.8 42.1 43.4 44.8 46.0 3.0% 1.23 3.2% 1.34
World 86.2 84.9 86.3 87.5 88.7 89.8 90.9 0.9% 0.77 1.4% 1.20
Low er GDP
Global GDP (y-o-y chg) 2.9% -1.2% 2.1% 2.8% 3.0% 3.0% 3.0% 2.2% 2.1%
OECD 47.6 45.5 45.5 45.1 44.8 44.3 43.9 -1.3% -0.61 -0.7% -0.32
Non-OECD 38.6 39.3 40.5 41.3 42.0 42.6 43.1 1.8% 0.74 1.8% 0.75
World 86.2 84.9 85.9 86.4 86.8 86.9 87.0 0.2% 0.13 0.5% 0.43
Low er vs. Higher
Global GDP (% points) 0.00 0.00 -1.00 -1.34 -1.44 -1.49 -1.50 -1.0 -1.1
OECD 0.00 0.00 -0.08 -0.27 -0.48 -0.70 -0.92 -0.3 -0.15 -0.4 -0.18
Non-OECD 0.00 0.00 -0.30 -0.82 -1.43 -2.15 -2.92 -1.1 -0.49 -1.3 -0.58
World 0.00 0.00 -0.38 -1.09 -1.91 -2.85 -3.84 -0.7 -0.64 -0.9 -0.77
11 D ECEMBER 2009 3
M ARKET O VERVIEW I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT
As in June, we also run a simplified lower GDP scenario, with economic growth levelling off at around 3%
annually during 2011‐2014. Price and efficiency assumptions are the same as in the higher case. This
would generate sub‐0.5 mb/d annual oil demand growth (+0.5% per annum) post‐2009 and take global
demand to just 87 mb/d in 2014 (broadly returning to 2007 global demand levels). As was the case in
June, the resulting 4 mb/d variance for mid‐decade demand makes a huge difference for medium‐term
oil market balances. Although annual contraction in OECD oil demand in this case is double that in the
higher GDP case, volumetrically 75% of the demand difference comes from the non‐OECD, where income
elasticity is higher.

Oil Supply
World oil supply growth now shows signs of an uptick around mid‐decade, compared with the weaker
trend developed in June. Although, based on currently active investment projects, non‐OPEC potential
still looks weak after 2011, higher expected OPEC crude and NGL capacity underpin this stronger outlook
for supply as a whole. That said, expanding the supply base remains difficult amid stretching lead times
and a shift to higher cost oil. However, the supply profile comes in an average 1.1 mb/d higher for the
2008‐2014 period, weighted to the back end of the forecast period. Amid higher prices and re‐emerging
oil demand growth, some previously deferred projects are moving forward once again.

Key to the non‐OPEC profile is a nearly 1 mb/d upgrade for 2009 production, centred on higher Russian
output, more robust Caspian supply and the absence of significant autumn US GOM hurricane outages.
Together these account for about 75% of the 2009 upgrade, which is largely fed through to 2014. Non‐
OPEC supply now increases by 0.7 mb/d for the 2008‐2014 period, compared with an earlier expected
decline of 0.4 mb/d. No across‐the‐board changes are made to future decline rates, since there is little
evidence that lower spending in 2009 versus 2008 has so far exacerbated these compared with our
original expectation. We have therefore not reproduced June’s low supply sensitivity for non‐OPEC.

The main change is for Russia, with
mb/d World Oil Supply Capacity Growth
2009 crude output now 270 kb/d 2.5
higher than expected in June. New
2.0
fields, like Rosneft’s Vankor in East
1.5
Siberia, have ramped up quicker than
1.0
expected, and mature West Siberian
0.5
output has borne up better than we
had anticipated. Late‐2008 rouble 0.0
devaluation, a modest easing of fiscal -0.5
terms in early 2009 and stronger -1.0
crude prices since then have all 2009 2010 2011 2012 2013 2014
OPEC Capacity Growth OPEC NGLs Growth
helped sustain spending and activity
Global Biofuels Growth Non-OPEC Growth (ex Biofuels)
levels. Nonetheless, after renewed
Total Net Change
growth in 2009 and 2010, we expect
Russian crude production to drift lower in 2011‐2014. But a detailed review of global gas liquids prospects
(to be presented in full in 2010) suggests growth from Russian NGL through mid‐decade could offset the
crude decline, as gas flaring is curbed and liquids capture increases. The key 2008‐2014 sources of non‐
OPEC supply growth remain Canadian oil sands, biofuels, the US GOM, Russian NGL, Azerbaijan,
Kazakhstan and Colombia. Conversely, Mexican and North Sea output fall by some 2 mb/d combined.

OPEC crude capacity is now seen growing by 2.8 mb/d over 2008‐2014, to 36.9 mb/d compared with the
1.7 mb/d expansion envisaged last June. Improvements in the geopolitical situation (Nigeria),
development contract uptake (Iraq) and the completion of cost renegotiation (Saudi Arabia) mean that
several projects now have firmer timelines. Angola, Iraq and Nigeria see projected 2014 capacity revised
higher by around 350 kb/d each, although Libyan capacity is revised down slightly.
4 11 D ECEMBER 2009
The mainstay of growth remains Saudi Arabia, where capacity increases by a largely unchanged 1.2 mb/d
to 12 mb/d (much of this during 2009/2010). The earlier idled Manifa project is now back on track, albeit
for later completion. Iraq sees capacity grow by 0.6 mb/d to 3.1 mb/d as more development contracts
have been signed with foreign companies. New projects also underline Angolan growth from 1.9 mb/d
to 2.5 mb/d. Nigerian capacity growth is more modest, reaching 2.85 mb/d in 2014 from 2.65 mb/d in
2009. However, this is a stronger profile than before, amid an admittedly still‐fragile peace deal
between government and Niger Delta rebels.

The OPEC gas liquids supply trend is slightly stronger, with production seen rising by 2.8 mb/d to
7.3 mb/d in 2014. About 80% of this increase comes from the Middle East Gulf producers, with Qatar,
Iran and Saudi Arabia prominent, while Nigeria and Algeria also show strong growth. Projections for
Algeria, UAE, Angola and Nigeria have been revised up since June, while lower associated gas supply
accounts for a slightly weaker Saudi Arabian profile. Nonetheless, ongoing LNG plant progress and an
imperative to develop natural gas for domestic use continue to underpin strong gas liquids growth for
OPEC overall.

Biofuels
Within the non‐OPEC supply forecast, biofuels prospects in 2008‐2014 are also revised up marginally (by
an average 35 kb/d, or some 2%) compared with the June MTOMR. Production in 2009 is now 1.6 mb/d,
with 2014 supply potentially hitting 2.2 mb/d. Brazil and the USA continue to account for the bulk of
expected growth, which, though marginal in overall volume terms, nonetheless accounts for around 15%
of expected incremental road transport fuel growth on an energy equivalent basis.

US ethanol production has proven robust since 2Q09 as
plant utilisation has increased on better production mb/d Global Biofuels Supply
2.4
margins. Total US ethanol production rises from
690 kb/d this year to 835 kb/d in 2014, despite ongoing 2.0
industry consolidation and uncertainty surrounding 1.6

adoption of an E15 blend. We also remain cautious over 1.2
the US’ ability to meet a Renewable Fuel Standard for 0.8
cellulosic ethanol of 115 kb/d in 2014. 0.4
0.0
Although still the key source of biofuels growth, 2007 2008 2009 2010 2011 2012 2013 2014
Brazilian 2009 ethanol production is revised down after OECD EUR Biodiesel Other Biodiesel
Other Ethanol Brazil Ethanol
poor harvest conditions, high sugar prices and US Ethanol
constrained capacity expansion. That said, supply still
grows from 475 kb/d in 2009 to 730 kb/d in 2014. Biodiesel prospects from Latin America are revised up
however, and supply is seen increasing by 50% between 2009 and 2014, to attain 75 kb/d. Although
policy uncertainty in OECD Europe persists, capacity expansions suggest regional biofuels output could
rise from 200 kb/d this year to 265 kb/d in 2014.

Refining
Expected global refinery capacity growth is revised up by 1.1 mb/d to 8.7 mb/d for the period 2008‐2014.
Growth is dominated by China (2.9 mb/d), other Asia (2.1 mb/d) and the Middle East (1.5 mb/d).
Elsewhere, initial signs of capacity rationalisation in the US and Latin America cut growth in these
regions. The closure of Valero’s Delaware and Sunoco’s Eagle Point refineries markedly reduce expected
North American regional growth to just 0.6 mb/d. European growth is unchanged since the last June’s
report, although several key projects are now expected to complete sooner, including GALP’s Sines and
Repsol’s Cartagena refinery expansions.

11 D ECEMBER 2009 5
M ARKET O VERVIEW I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT
Crude Distillation Capacity mb/d Crude Distillation Forecast

mb/d
Additions Revisions
2.0 1.2
1.5 0.8
1.0 0.4
0.5 0.0
0.0 -0.4
-0.5 -0.8
2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014
OECD China OECD China
Other Asia Middle East Other Asia Middle East
Other Non-OECD Other Non-OECD
More generally, our earlier concerns over project delays, due to limited access to capital markets or
retendering to capture lower costs, seem to have been overdone. Projects such as Saudi Arabia’s
400 kb/d Jubail refinery and the UAE’s 420 kb/d Ruwais expansion awarded engineering, procurement,
and construction contacts some nine to 15 months ahead of our previous expectations. Consequently,
we have now included these projects within the 2014 timeframe. The Chinese government’s stimulus
programme is seen boosting Chinese capacity expansions over the medium term, notably in the
country’s southeast. Similarly, in India, progress to date on several refinery projects aiming to take
advantage of tax breaks, which expire in 2012, has been better than expected, so we have brought
forward expected completion dates, even if early utilisation rates may be open to question. A more
complete review of regional operating rates and oil products balances will be contained in MTOMR 2010.

Oil Market Balances
The expected call on OPEC crude and stock change in the higher GDP scenario now stands an average
1 mb/d higher than in June, primarily due to a stronger demand baseline carried through the forecast.
This has also curbed average effective OPEC spare capacity for most of the period until 2014, even
though OPEC capacity itself has also been revised higher (not to mention the persistent OECD stock
overhang evident in 2009). The basic shape of the market balance under the higher GDP case
nonetheless remains similar to June, with physical fundamentals tightening from 2011 onwards, pushing
effective OPEC spare capacity back down towards 3.5 mb/d in 2013 and 2014.
Global Balance Summary (Higher GDP Scenario)

2008 2009 2010 2011 2012 2013 2014

Global Dem and 86.22 84.86 86.33 87.51 88.66 89.80 90.86
Non-OPEC Supply 50.68 51.27 51.65 52.13 52.12 51.69 51.35
OPEC NGLs, etc. 4.51 4.86 5.68 6.34 6.65 6.96 7.35
Global Supply excluding OPEC Crude 55.19 56.13 57.33 58.48 58.78 58.65 58.70
OPEC Crude Capacity 34.15 34.81 35.66 35.37 35.19 35.75 36.90
Call on OPEC Crude + Stock Ch. 31.03 28.73 29.00 29.03 29.89 31.14 32.16
1
Implied OPEC Spare Capacity 3.12 6.08 6.67 6.34 5.30 4.61 4.74
Effective OPEC Spare Capacity 2 2.12 5.08 5.67 5.34 4.30 3.61 3.74
as percentage of global demand 2.5% 6.0% 6.6% 6.1% 4.9% 4.0% 4.1%
Changes since June 2009 MTOMR

Global Dem and 0.45 1.66 2.00 1.92 1.91 1.89 1.88
Non-OPEC Supply 0.08 0.95 1.06 1.02 1.42 1.29 1.13
OPEC NGLs, etc. -0.15 -0.35 -0.39 -0.27 -0.25 -0.13 0.03
Global Supply excluding OPEC Crude -0.07 0.60 0.67 0.74 1.17 1.15 1.16
OPEC Crude Capacity 0.00 0.11 0.21 0.42 0.35 0.27 1.06
Call on OPEC Crude + Stock Ch. 0.53 1.06 1.32 1.18 0.73 0.74 0.72
1
Implied OPEC Spare Capacity -0.53 -0.95 -1.11 -0.76 -0.38 -0.47 0.35
1 OP EC Capacity minus 'Call o n Opec + Sto ck Ch.' 2 Histo rically effective OP EC spare capacity averages 1mb/d belo w no tio nal spare capacity.
6 11 D ECEMBER 2009
That said, and acknowledging that the pace of supply growth will remain constrained for the foreseeable
future, the path of economic recovery remains the key to determining where oil markets are heading
over the next five years. The lower GDP case may not currently be a consensus view but it has many
adherents, who see the pressures of accumulating budgetary deficits and for now rising rates of
unemployment as inevitably constraining economic recovery. Our simplified scenario, merely slicing a
third off the higher GDP case, likely fails to represent the distinct shape of any such constrained
recovery, but does demonstrate the primacy of economic growth in driving oil demand.
mb/d Medium-Term Oil Market Balance (Higher GDP Scenario) mb/d

4.0 8.0
3.0 6.0
2.0 4.0
1.0 2.0
0.0 0.0
-1.0 -2.0
-2.0 -4.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Effective OPEC Spare Capacity (RHS) World Demand Growth

World Supply Capacity Growth

Put simply, despite persistently sluggish supply‐side growth, annual demand growth of markedly below
1 mb/d can likely be accommodated, without eating into the current margin of spare capacity. OPEC
producers might be alarmed at the prospect of spare capacity above 6 mb/d sustained through mid‐
decade. However, we would argue that in the face of manifold geopolitical risks, a margin of supply
flexibility of between 7‐8% is hardly excessive and is unlikely on its own to lead to any form of price
collapse. Of course, this ‘shock absorber’ for the market could also be realised in the event of the
stronger economic growth case, if that was accompanied by accelerated efficiency improvements. So,
over the longer term, security of supply and environmental goals (like those itemised in the WEO’s 450
scenario) can be met, even under an assumption of higher GDP growth, by accelerating efforts to reduce
oil intensity beyond the 3% annual gains assumed here. A dual‐track approach of unblocking supply‐side
bottlenecks and encouraging more efficient oil use may therefore be the most effective policy path for
avoiding price volatility in future.

mb/d Medium-Term Oil Market Balance (Lower GDP Scenario) mb/d

4.0 8.0
3.0 6.0
2.0 4.0
1.0 2.0
0.0 0.0
-1.0 -2.0
-2.0 -4.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Effective OPEC Spare Capacity (RHS) World Demand Growth

World Supply Capacity Growth
11 D ECEMBER 2009 7
D EMAND I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT
DEMAND

Summary
• Forecast global oil demand remains virtually unchanged in 2009 and is revised up by 130 kb/d in
2010. Global oil demand is expected to average 84.9 mb/d in 2009 (‐1.6% or ‐1.4 mb/d year‐on‐year)
and 86.3 mb/d in 2010 (+1.7% or +1.5 mb/d versus the previous year). Growth continues to be driven
by non‐OECD countries, notably in Asia and the Middle East. Nonetheless, OECD prospects have
improved to some extent, particularly in the Pacific.

• The OECD oil demand projection remains broadly unchanged in 2009, but is slightly adjusted up by
70 kb/d in 2010 on the back of an improved outlook for the Pacific, especially in Korea. Oil demand is
set to fall by 4.3% year‐on‐year (‐2.0 mb/d) to 45.5 mb/d in 2009 and remain flat in 2010, as a year‐
on‐year contraction in 1Q10 is expected to be offset by a return to modest growth in the following
quarters. Yet a key risk to the forecast pertains to the US outlook. Demand remains stubbornly
sluggish, with a continued contraction in distillate deliveries and very modest growth in gasoline
demand despite a very weak 2008 baseline. Moreover, the unpredictable nature of weekly‐to‐
monthly revisions, given the weight of US demand, have resulted in large regional and global
adjustments in recent months. These have retrospectively revealed markedly different oil market
conditions than suggested by preliminary weekly data, thus highlighting the difficulty of reconciling
data timeliness and accuracy.

Global Oil Demand (2008-2010)
1Q08 2Q08 3Q08 4Q08 2008 1Q09 2Q09 3Q09 4Q09 2009 1Q10 2Q10 3Q10 4Q10 2010
Africa 3.2 3.2 3.1 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.3 3.3 3.3 3.3 3.3
Americas 30.5 30.4 29.6 29.9 30.1 29.3 28.9 29.4 29.4 29.2 29.4 29.3 29.9 29.8 29.6
Asia/Pacific 26.7 25.7 25.0 25.1 25.6 25.7 26.0 25.8 26.3 26.0 26.6 26.4 26.0 26.5 26.4
Europe 16.1 15.8 16.2 16.2 16.1 15.6 15.0 15.2 15.5 15.3 15.5 15.0 15.3 15.5 15.4
FSU 4.2 4.1 4.3 4.1 4.2 3.9 3.8 4.0 4.0 3.9 4.1 4.0 4.2 4.2 4.1
Middle East 6.7 7.1 7.6 7.0 7.1 6.7 7.3 7.8 7.1 7.2 7.1 7.6 8.0 7.5 7.6
World 87.4 86.3 85.8 85.3 86.2 84.5 84.1 85.3 85.5 84.9 86.1 85.6 86.7 86.8 86.3
Annual Chg (%) 1.1 0.9 -0.6 -2.8 -0.3 -3.4 -2.5 -0.6 0.2 -1.6 2.0 1.8 1.6 1.5 1.7
Annual Chg (mb/d) 1.0 0.8 -0.5 -2.4 -0.3 -3.0 -2.2 -0.5 0.2 -1.4 1.6 1.5 1.4 1.3 1.5
Changes from last OMR (mb/d) -0.05 -0.07 -0.12 -0.11 -0.09 -0.10 -0.07 0.18 0.06 0.02 0.11 0.09 0.18 0.16 0.13

• Forecast non‐OECD oil demand has been increased up by roughly 20 kb/d and 60 kb/d for 2009 and
2010, respectively. This results from higher‐than‐expected preliminary data for China and India,
whose economies continue to benefit from government stimuli. Non‐OECD demand is expected to
reach 39.3 mb/d in 2009 (+1.8% or +0.7 mb/d year‐on‐year) and 40.8 mb/d in 2010 (+3.7% or
+1.4 mb/d versus the previous year). Nonetheless, the forecast faces considerable uncertainty
regarding data quality. The most glaring is the seeming mismatch between China’s subdued gasoline
demand and surging car sales. It remains unclear whether Chinese drivers are highly circumspect with
regards to car usage, whether the vehicle fleet has suddenly become extremely efficient or whether
gasoline demand is simply being under‐reported.

• Medium‐term oil product demand is now expected to be some 1.9 mb/d higher over 2009‐2014
when compared with the June 2009 MTOMR. Global oil product demand is forecast to rise by 1.4% or
1.2 mb/d per year on average between 2009 and 2014, from 84.9 mb/d to 90.9 mb/d, with non‐OECD
demand accounting for more than half of global demand by mid‐decade. The changes to the
prognoses are related to baseline revisions, essentially in China and non‐OECD Asia; much stronger‐
than‐expected oil demand growth in 2009 as a result of massive fiscal and monetary stimulus
programmes; and stronger IMF GDP assumptions for 2009 and 2010, offset to a degree by a higher
price assumption.
8 11 D ECEMBER 2009
I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT D EMAND

Medium-Term Demand Update
We have updated our medium‐term forecast released in June. As noted in the market overview, oil demand
is now expected to be some 1.9 mb/d higher over 2009‐2014 when compared with June’s MTOMR. Global
oil product demand is seen growing by 1.4% or 1.2 mb/d per year on average between 2009 and 2014, from
84.9 mb/d to 90.9 mb/d, with non‐OECD demand accounting for more than half of global demand for the
first time ever by mid‐decade. In order to provide a range for potential demand evolution, we maintain our
alternative, ‘low GDP’ scenario, whereby global GDP growth would remain subdued, expanding by only 3%
post‐2011 or about a third less than under the
higher case. Under this scenario, oil demand would m b/d Global Demand: GDP Sensitivity
grow by only 0.5% or 430 kb/d per year on average 91.5
Higher GDP
to 87 mb/d by 2014, a difference of 3.8 mb/d versus 90.5
Low er GDP
the higher case. 89.5
88.5
The changes to the prognoses are primarily related
to baseline revisions, notably in non‐OECD 87.5
countries, much stronger‐than‐expected oil demand 86.5
growth in 2009 as a result of massive fiscal and 85.5
monetary stimuli implemented by governments 84.5
across the world, and higher IMF GDP assumptions 2008 2009 2010 2011 2012 2013 2014
for 2009 and 2010. (In its October update, the IMF
front‐loaded growth at the beginning of the forecast period while trimming slightly the prognoses for later
years.) In addition, we lifted our medium‐term price assumption to roughly $76/bbl in real terms by 2014,
compared with $60/bbl in June, based on the prevailing futures strip as of early December. Non‐OECD
countries – mostly China and the rest of Asia – account for roughly three‐quarters of the forecast revision,
highlighting the growing resilience of that part of the world relative to the OECD. It also demonstrates that
data remain patchy in several key emerging countries, an issue poised to become more pressing in future,
given that the centre of gravity of the oil market will shift to emerging countries.
Global Oil Demand: Difference vs. Previous Non-OECD Demand: Difference vs. Previous
MTOMR MTOMR
kb/d 2007 2008 2009 2010 2011 2012 2013 kb/d 2007 2008 2009 2010 2011 2012 2013
2,500 2,000
2,000 1,500
1,000
1,500
500
1,000
-
500 (500)
Africa Latin Am erica
- China Other Asia
Non-OECD Europe FSU
OECD Non-OECD WORLD Middle East Non-OECD

It is worth noting that the growth in oil demand
observed in 2009 and expected in 2010 will be
Oil Intensity (1995 = 100)
somewhat ‘anomalous’, driven by extremely loose
100
macroeconomic policies in big emerging economies, OECD Non-OECD
95
most notably China. As such, the fall in oil intensity
90
over 2009‐2010 will be relatively limited, but by
2011 it should resume and even accelerate relative 85
to its historical pattern, assuming economic growth 80
is sustained after the withdrawal of macroeconomic 75
stimuli. Between 1998 and 2008, global oil intensity 70
declined by ‐2.2% per year on average. We assume 65
that the fall will slow to only ‐0.9% per year on 60
average over 2009‐2010, and then accelerate to 1995 1998 2001 2004 2007 2010 2013
‐3.0% per year on average over 2011‐2014.
11 D ECEMBER 2009 9
OECD
According to preliminary data, OECD inland deliveries (oil products supplied by refineries, pipelines and
terminals) contracted by 4.1% year‐on‐year in October. In OECD Europe, oil product demand
plummeted by 7.1% year‐on‐year, with all product categories posting losses. In OECD North America
(which includes US Territories), demand fell by 3.7% as the rebound in LPG, gasoline, jet fuel/kerosene
and residual fuel oil demand failed to offset continued gasoil decline. By contrast, demand in OECD
Pacific grew (+1.0%) for the first time in 16 months, boosted by strong deliveries of naphtha, gasoline
and middle distillates.

Global Demand Growth 2008/2009/2010
thousand barrels per day
North America
Europe FSU 205
170
50 10
-34
-763 Middle East -240

561 Asia
-893 327 419
328
136 136
-1301
Latin America Africa

225 114 103
192 Global Demand Growth
26
51 (mb/d)
2008 -0.29 -0.3%
2009 -1.35 -1.6%
2010 1.47 1.7%

The relatively large revisions to September preliminary data (+790 kb/d) were almost entirely due to
North America, as deliveries for LPG, gasoline, gasoil and ‘other products’ proved to be much stronger
than suggested by preliminary data. As such, September demand contracted by 1.7% year‐on‐year,
almost half than previously reported (‐3.5%). However, given other revisions, OECD oil demand is
virtually unchanged for this year (‐10 kb/d when compared with last month’s report), but is revised
slightly higher for next year (+70 kb/d). Demand is thus expected to contract by 4.3% in 2009 to
45.5 mb/d and remain flat in 2010.

OECD Demand based on Adjusted Preliminary Submissions - October 2009
Gasoline Jet/Kerosene Diesel Other Gasoil RFO Other Total Products
mb/d % pa mb/d % pa mb/d % pa mb/d % pa mb/d % pa mb/d % pa mb/d % pa
OECD North Am erica* 10.62 0.5 1.65 0.9 3.66 -15.4 0.93 -8.1 1.05 2.1 5.59 -4.29 23.52 -3.7
US50 9.06 0.4 1.44 0.8 3.11 -17.9 0.43 7.3 0.58 -3.2 4.19 -6.1 18.80 -4.5
Canada 0.73 0.8 0.12 9.0 0.21 -6.4 0.35 -11.4 0.09 -21.7 0.74 4.9 2.26 -1.6
Mexico 0.76 0.8 0.05 -10.6 0.29 -8.6 0.12 -8.6 0.28 30.6 0.59 -1.8 2.09 0.8
OECD Europe 2.27 -3.6 1.29 -5.5 4.48 -3.2 1.92 -17.7 1.48 -14.4 3.39 -4.4 14.83 -7.1
Germany 0.46 -7.4 0.20 -4.0 0.70 -0.2 0.42 -40.1 0.13 -31.7 0.53 -5.4 2.44 -14.7
United Kingdom 0.35 4.5 0.34 -4.5 0.40 -13.0 0.13 -7.5 0.09 -21.2 0.34 5.1 1.66 -4.6
France 0.20 -6.8 0.15 -7.4 0.70 -1.9 0.33 -10.5 0.11 -13.1 0.44 -11.6 1.92 -7.4
Italy 0.25 -6.2 0.08 -7.8 0.58 -2.5 0.13 -1.4 0.20 -17.8 0.32 -4.8 1.56 -6.0
Spain 0.14 -4.0 0.12 2.0 0.49 -3.9 0.20 -9.4 0.20 -5.9 0.31 -7.2 1.46 -5.2
OECD Pacific 1.56 5.5 0.84 21.3 1.27 5.7 0.40 -6.2 0.61 -24.5 2.92 0.0 7.61 1.0
Japan 0.98 3.8 0.52 21.5 0.59 3.1 0.28 -4.0 0.33 -28.1 1.56 -7.3 4.26 -2.7
Korea 0.19 20.7 0.20 40.8 0.30 17.2 0.11 -11.4 0.24 -22.2 1.18 11.9 2.22 8.5
Australia 0.33 0.1 0.11 -0.4 0.33 0.6 0.00 9.9 0.04 -0.1 0.17 -1.3 0.97 0.0
OECD Total 14.46 0.3 3.78 2.4 9.42 -7.3 3.25 -13.8 3.14 -12.0 11.90 -3.3 45.95 -4.1
* Including US territo ries

10 11 D ECEMBER 2009

m b/d OECD: Total Oil Product Demand OECD: Demand by Driver, Y-o-Y Chg
53 Transport Heating
m b/d Pow er Gen. Other
51 Total Dem .
1.0
49 0.5
-
47
(0.5)
45 (1.0)
(1.5)
43
(2.0)
Jan Apr Jul Oct Jan
(2.5)
Range 2004-2008 5-year avg
2008 2009 2007 2008 2009 2010

Total OECD Demand by Product
Latest m onth vs.
2008 2009 3Q08 4Q08 1Q09 2Q09 Jul 09 Aug 09 Sep 09*
Aug 09 Sep 08
LPG & Ethane 4.65 4.52 4.27 4.55 4.83 4.36 4.47 4.29 4.38 0.09 0.41
Naphtha 3.06 2.95 3.05 2.86 2.96 2.86 2.93 2.90 3.10 0.20 0.14
Motor Gasoline 14.41 14.43 14.45 14.36 14.00 14.55 14.96 14.88 14.39 -0.48 0.35
Jet & Kerosene 3.98 3.77 3.81 3.90 3.99 3.53 3.62 3.68 3.56 -0.12 -0.17
Gas/Diesel Oil 13.04 12.30 12.64 13.43 13.09 11.78 11.83 11.23 12.24 1.01 -1.08
Residual Fuel Oil 3.66 3.22 3.53 3.61 3.61 3.07 2.86 2.99 2.89 -0.10 -0.57
Other Products 4.76 4.33 4.88 4.61 4.08 4.30 4.62 4.55 4.81 0.26 0.10
Total Products 47.57 45.52 46.63 47.32 46.57 44.45 45.29 44.51 45.38 0.86 -0.81
* Latest o fficial OECD submissio ns (M OS)

North America
Preliminary data show that oil product demand in North America (including US Territories) fell by 3.7%
year‐on‐year in October. With the exception of September 2009, which posted growth relative to a low
2008 baseline, demand in the region has uninterruptedly contracted on a yearly basis since the summer
of 2007. The fall in October was largely due to the United States (‐4.4% year‐on‐year), followed by
Canada (‐1.6%). By contrast, Mexico posted modest growth for the second month in a row (+0.8%).

OECD North America: OECD NA: Demand by Driver,
m b/d Total Oil Product Demand Y-o-Y Chg
27 Transport Heating
m b/d Pow er Gen. Other
26 Total Dem .
0.5
25
-
24
(0.5)
23
22 (1.0)
Jan Apr Jul Oct Jan
(1.5)
2008 2009 2007 2008 2009 2010

Revisions to September preliminary data were sizeable (+670 kb/d), almost entirely due to the US, with
upward adjustments in LPG, naphtha, gasoline, gasoil and ‘other products’ offsetting lower readings for
jet fuel/kerosene and residual fuel oil. Total demand in North America actually rose by 2.8% year‐on‐
year in September, rather than declining by 0.2%. However, on an annual basis, forecast North American
oil product demand is little changed. It should average 23.3 mb/d in 2009 (‐3.7% or ‐890 kb/d versus
2008 and ‐40 kb/d versus our last report), while demand in 2010 should rise to 23.4 mb/d (+0.7% or
+170 kb/d year‐on‐year and some 30 kb/d higher than previously thought).
11 D ECEMBER 2009 11

OECD North America Demand by Product

Latest m onth vs.
2008 2009 3Q08 4Q08 1Q09 2Q09 Jul 09 Aug 09 Sep 09*
Aug 09 Sep 08
LPG & Ethane 2.72 2.67 2.46 2.66 2.88 2.51 2.62 2.64 2.64 0.00 0.51
Naphtha 0.36 0.31 0.36 0.33 0.29 0.33 0.33 0.30 0.33 0.03 0.01
Motor Gasoline 10.51 10.57 10.48 10.50 10.30 10.63 10.91 10.84 10.45 -0.39 0.42
Jet & Kerosene 1.77 1.66 1.79 1.64 1.66 1.62 1.75 1.68 1.59 -0.10 -0.10
Gas/Diesel Oil 5.01 4.60 4.77 5.03 4.94 4.41 4.44 4.36 4.49 0.13 -0.34
Other Products 2.69 2.48 2.67 2.71 2.38 2.43 2.62 2.58 2.72 0.14 0.20
Total Products 24.17 23.28 23.57 23.93 23.52 22.92 23.45 23.41 23.06 -0.35 0.63

Adjusted preliminary weekly data in the continental United States indicate that inland deliveries – a
proxy of oil product demand – contracted by 3.7% year‐on‐year in November, following a 4.5% fall in
October. The September spike (+3.1% on revised data) appears to have been short‐lived and owing
mostly to a weak, hurricane‐stricken 2008 baseline. However, the preliminary estimates for October and
November could still be sharply revised (see Another Source of Uncertainty).

kb/d US50: Total Oil Product Demand kb/d US50: Diesel Demand
22,500 3,900
21,500 3,700
3,500
20,500
3,300
19,500
3,100
18,500 2,900
17,500 2,700
Jan Apr Jul Oct Jan Jan Apr Jul Oct Jan
Range 2004-2008 5-year avg Range 2004-2008 5-year avg
2008 2009 2008 2009

Meanwhile, diesel demand – which is strongly correlated with economic activity – continues to be
stubbornly weak, falling by 7.9% year‐on‐year in September. Adjusted weekly figures suggest that
demand may have contracted by as much as 17.9% in October and by 8.3% in November, despite the
beginning of the Christmas shopping season after
Thanksgiving. Jet fuel demand, which is also considered US: Total Avg. Daily Vehicle-Miles
bn
a leading economic indicator, is hardly faring better. It 9.0
Travelled
fell by 5.7% in September, and rose by only +0.8% and
+2.7% in October and November, respectively – a very 8.5
modest improvement considering the extremely weak
8.0
2008 baseline.
7.5
Gasoline demand registered a bounce in September
Source: FHWA
(+4.8%), commensurate with a 2.6% yearly increase in 7.0
average daily vehicle‐miles travelled for the fourth Jan Apr Jul Oct
month in a row. Yet this appears to have been a 2008 2009
temporary summer holiday phenomenon as travellers
reportedly choose to drive rather than fly. Indeed, adjusted weekly data indicate that gasoline deliveries
rose by only 0.4% and 0.7% in October and November, respectively. In sum, the outlook for US oil
demand is largely unchanged, with oil product demand expected to average 18.7 mb/d in 2009 (‐4.0%
year‐on‐year) and 18.9 mb/d in 2010 (+0.7%).



Another Source of Uncertainty
Over recent months, it has become increasingly difficult to gauge US monthly demand trends from
preliminary weekly data. In terms of direction, the revisions from EIA weekly to monthly data have been
generally downwards, reflecting the fact that weekly figures are an initial sample that tends to overestimate
actual demand. However, the revisions for October 2008 and April‐July 2009 were positive. While the
October 2008 revision was probably due to the effects of last year’s hurricanes, those of the 2009 summer
were quite unusual – actually revealing that there was a driving season this year, contrary to what the
weekly data had suggested. Perhaps the change in direction was related to strong ethanol production, but if
so, it is unclear why there was again a reversal in August and September.
Regarding their magnitude, the revisions increased gradually – and markedly – over the past year. This
could result from the economic recession; indeed, exports may have been counted as demand in the weekly
data, being later removed from the more precise monthly estimates. However, if this is the case, it is
unclear why the revisions for November 2008 and January, March, April and July 2009 were relatively minor,
and why they increased sharply again in August and September. Finally, the products concerned have also
varied noticeably. The revisions are usually concentrated in ‘other oils’ (comprising LPG, naphtha and ‘other
products’ as defined in this report), gasoline and gasoil. However, in recent months the changes to jet fuel
or fuel oil have also been relatively sizeable.
US50 Monthly Revisions: EIA's Weeklies vs US50 Monthly Revisions: EIA's Weeklies vs
kb/d kb/d
MOS Submissions, Total Products MOS Submissions by Product
800 1,000
Other (LPG, naphtha, 'other products')
800 Fuel Oil
400 600 Gasoil
Jet Fuel
400 Gasoline
- 200
-
(400) (200)
(400)
(800) (600)
(800)
(1,200) (1,000)
A 7
A 8
A 9
O 7
O 8
9
8
Ja 7
Ja 8
7
09
9
0
0
l-0
l-0
l-0
-0
-0
-0
-0
-0
-0
-0
-0
-0
-0
n-
n-
n-
b-
ug
ct
ct
ct
ec
n
pr
pr
pr
pr
Ju
Ju
Ju
Ja
Fe
Ju
O

Given this irregular pattern of revisions, any pre‐emptive weekly‐to‐monthly adjustment on our part is prone
to miss the mark. Indeed, based on a three‐month average of previous changes, the revision for October
should be around ‐350 kb/d. However, using a six‐month average would result in a ‐70 kb/d adjustment,
while a nine‐month average would imply ‐170 kb/d and a twelve‐month average ‐150 kb/d. For the past two
months, our own pre‐emptive adjustment has been based on a twelve‐month average, in order to smooth
out the unexpected changes observed recently. Yet we underestimated demand for September by almost
+580 kb/d. In sum, difficulties in anticipating US monthly data have become a major source of oil demand
uncertainty. Given the weight of US demand, these weekly‐to‐monthly revisions have resulted in large
regional and global swings, retrospectively revealing markedly different market profiles than thought when
preliminary weekly data were first released. While US weekly data are immensely helpful in providing an
initial snapshot, it nonetheless highlights the vexing issue of data timeliness versus accuracy, with a
convergence unfortunately very difficult to achieve.

Oil product demand in Mexico has risen for the past two months, after a year of continuous monthly falls
(only briefly interrupted in March) triggered by the combined effects of the recession and the A/H1N1 flu
alert. Demand increased by 1.4% year‐on‐year in September and by 0.8% in October, but this
improvement was essentially due to a surge in residual fuel oil demand for power generation over the
summer, rather than to a sustained recovery from the global economic slump. Indeed, the country has

faced one of its worst droughts since the 1930s (which has resulted in less electricity production from
hydro sources). On the economic front, Mexico is actually likely to be among the hardest hit countries,
owing to its dependence on the US market.

kb/d Mexico: Total Oil Product Demand kb/d Mexico: Residual Fuel Oil Demand
2,250 450
2,200 400
2,150
350
2,100
300
2,050
250
2,000
1,950 200
1,900 150
2008 2009 2008 2009

State‐owned Pemex announced plans to invest $12.1 billion over the next decade to repair its 47,000‐km
pipeline network and build new lines. This will probably help reduce the number of pipeline leaks from a
25‐year old network that has suffered from inadequate maintenance. However, it is unclear whether the
theft of crude and refined products from Pemex’s pipelines – which may be somewhat inflating overall
demand – will be curbed. The company admits this is a serious issue, implying a loss of at least $700
million per year through some 400 illegal pipeline connections (other observers reckon that Mexico’s fuel
black market could total as much as $2 billion per year). More recently, the smuggling even acquired an
international dimension, as executives of two oil companies based in Houston admitted to having bought
stolen condensate in order to resell it in the US, and there are reports that several other companies are
being investigated.

Europe
Oil product demand in Europe plunged by 7.1% year‐on‐year in October, according to preliminary inland
data, with all product categories posting losses. Admittedly, the fall was largely driven by weak deliveries
of heating oil (‐17.7%) and residual fuel oil (‐14.4%), following trends that emerged a few months ago.
Lower heating oil demand in 2H09 has naturally followed the strong pace of consumer stockbuilds during
1H09, while cheaper natural gas remains also a viable alternative to residual fuel oil in industry.

OECD Europe: OECD Europe: Demand by Driver,
m b/d
Total Oil Product Demand Y-o-Y Chg
16.5 Transport Heating
16.0 m b/d Pow er Gen. Other
Total Dem .
15.5 0.2
15.0 -
14.5 (0.2)
14.0 (0.4)
13.5 (0.6)
Jan Apr Jul Oct Jan
(0.8)
2008 2009 2007 2008 2009 2010

Revisions to September preliminary demand data (‐70 kb/d) were mostly concentrated on distillates and
residual fuel oil. OECD Europe oil demand thus fell more on a yearly basis during that month than
previously anticipated (‐7.2% instead of ‐6.8%). Forecast oil product demand remains broadly
unchanged at 14.6 mb/d in 2009 (‐4.8% or ‐740 kb/d versus 2008), barely increasing in 2010 (+0.3%or
+40 kb/d year‐on‐year).

OECD Europe Demand by Product

Latest m onth vs.
2008 2009 3Q08 4Q08 1Q09 2Q09 Jul 09 Aug 09 Sep 09*
Aug 09 Sep 08
LPG & Ethane 1.03 0.97 0.95 0.99 1.05 0.99 0.95 0.86 0.86 0.01 -0.11
Naphtha 1.06 0.98 1.04 0.96 1.03 0.89 0.99 0.93 1.04 0.12 0.02
Motor Gasoline 2.36 2.31 2.45 2.30 2.19 2.39 2.48 2.36 2.39 0.03 -0.08
Jet & Kerosene 1.32 1.25 1.42 1.27 1.19 1.26 1.32 1.36 1.35 -0.01 -0.06
Gas/Diesel Oil 6.35 6.12 6.33 6.69 6.51 5.81 5.94 5.36 6.25 0.89 -0.60
Residual Fuel Oil 1.64 1.48 1.63 1.70 1.61 1.36 1.38 1.32 1.44 0.11 -0.25
Other Products 1.57 1.49 1.71 1.49 1.33 1.53 1.65 1.58 1.65 0.07 -0.07
Total Products 15.33 14.59 15.52 15.41 14.91 14.23 14.70 13.76 14.98 1.22 -1.15

Preliminary data indicate that German oil product demand plummeted in October (‐14.7% year‐on‐year),
marking the third consecutive month of double‐digit falls. This is mostly due to weak demand for
heating oil (‐40.1%) and residual fuel oil (‐31.7%). Consumer heating oil stocks remained at 68% of
capacity by end‐October, the highest level in the past two years, unchanged from September but much
higher than in the same month of the previous year (62%). In the meantime, cheaper natural gas
continued to compete favourably against fuel oil. A similar picture prevailed in France, although the
contraction was less pronounced. Oil product deliveries fell in October (‐7.4% year‐on‐year), dragged
down by lower deliveries of heating oil (‐10.5%) and residual fuel oil (‐13.1%).

kb/d Germany: Heating Oil Demand kb/d France: Residual Fuel Oil Demand
800 170
700 150
600
130
500
110
400
300 90
200 70
2008 2009 2008 2009

kb/d Poland: Total Oil Product Demand kb/d Poland: Diesel Demand
630 280
580
230
530
180
480
130
430
380 80
2008 2009 2008 2009

It is worth noting that Polish oil product demand has rebounded strongly since May, growing at 3.6% on
a yearly basis in October, according to preliminary figures. Poland is the only large European country
that managed to avoid a recession altogether. As such, oil demand has been fairly resilient – although,
admittedly, total demand is about a third to a half of that of European countries of equivalent land size
and population. Growth has been supported mostly by transportation needs, which have offset the
structural decline of heating oil and residual fuel oil. Diesel, which accounts for roughly 40% of total
demand, has expanded at double‐digit rates for the past four months, reflecting the ongoing
‘dieselisation’ of the vehicle fleet, notably among corporate users.

Pacific
Oil product demand in the Pacific grew (+1.0%) for the first time in 16 months, boosted by strong
deliveries of naphtha, gasoline and middle distillates, according to preliminary data. In terms of
countries, though, growth was entirely due to Korea, as Japan continued to report a contraction.

OECD Pacific: OECD Pacific: Demand by Driver,

m b/d
Total Oil Product Demand Y-o-Y Chg
10.0 Transport Heating
9.5 m b/d Pow er Gen. Other
Total Dem .
9.0 0.2
8.5
-
8.0
(0.2)
7.5
7.0 (0.4)
Jan Apr Jul Oct Jan
(0.6)
2008 2009 2007 2008 2009 2010

September revisions were relatively large (+190 kb/d), owing to higher‐than‐expected demand for
heating oil, residual and ‘other products’. Forecast OECD Pacific demand has thus been slightly revised
up to 7.7 mb/d in 2009 (‐5.1% or ‐410 kb/d on a yearly basis and +60 kb/d versus our last report) and
7.5 mb/d in 2010 (down by 2.4% or 190 kb/d when compared with the previous year and +40 kb/d
versus previous estimates).

OECD Pacific Demand by Product
Latest m onth vs.
2008 2009 3Q08 4Q08 1Q09 2Q09 Jul 09 Aug 09 Sep 09*
Aug 09 Sep 08
LPG & Ethane 0.90 0.87 0.86 0.90 0.90 0.85 0.91 0.80 0.88 0.08 0.02
Naphtha 1.64 1.67 1.65 1.56 1.64 1.64 1.60 1.67 1.73 0.05 0.12
Motor Gasoline 1.54 1.56 1.52 1.56 1.51 1.52 1.57 1.68 1.55 -0.13 0.01
Jet & Kerosene 0.89 0.85 0.60 0.99 1.15 0.66 0.55 0.64 0.63 -0.01 -0.01
Gas/Diesel Oil 1.68 1.59 1.55 1.70 1.64 1.56 1.45 1.52 1.51 -0.01 -0.13
Other Products 0.50 0.36 0.50 0.40 0.38 0.33 0.35 0.39 0.44 0.05 -0.03
Total Products 8.07 7.65 7.54 7.97 8.14 7.30 7.14 7.35 7.34 -0.01 -0.28

According to preliminary data, Japanese oil demand contracted by 2.7% year‐on‐year in October,
dragged down by weak deliveries of LPG (‐10.9%), residual (‐28.1%) and ‘other products’ (‐27.5%).
Nonetheless, diesel, naphtha and jet fuel/kerosene demand recorded strong readings (+3.1%, +6.9% and
+21.5%, respectively). The resilience of naphtha and diesel demand reflect rebounding industrial and
transportation activity fuelled by rising exports to Asia, particularly to China (petrochemicals, cars,
electronics and steel). The rise in jet fuel/kerosene deliveries, meanwhile, is largely in line with seasonal
patterns, as kerosene is mostly used for heating, although it could be argued that Japanese consumers
may have decided to fill their tanks somewhat earlier in anticipation of seasonally higher prices.

Korea has also benefited from strong Chinese imports, perhaps even more than Japan. Its economy
grew faster in 3Q09 than initially estimated (+0.9% year‐on‐year instead of 0.6%, equivalent to +3.2%
quarter‐on‐quarter). Total oil product deliveries rose by 8.5% year‐on‐year in October, underpinned by
strong demand for naphtha (+9.0%), which accounts for 40% of total Korean demand, and jet
fuel/kerosene ahead of the heating season. More interestingly, perhaps, gasoline deliveries surged
counter‐seasonally (+20.7%), but it should be noted that gasoline demand has been particular strong
since 2Q09, possibly indicating more resilient disposable income per capita.



kb/d Japan: Naphtha Demand kb/d Japan: Diesel Demand
950 750
900 700
650
850
600
800
550
750
500
700 450
650 400
2008 2009 2008 2009

kb/d Korea: Naphtha Demand kb/d Korea: Motor Gasoline Demand

1,050 210
950 190
850 170
750 150
650 130
2008 2009 2008 2009

Non-OECD
China
Preliminary data indicate that China’s apparent demand (refinery output plus net oil product imports)
surged by 13.4% year‐on‐year in October, with all product categories bar residual fuel oil posting gains.
This was the second consecutive month of double‐digit growth, underpinned by buoyant demand for
naphtha (+31.7%), jet fuel/kerosene (+26.5%) and ‘other products’ (+40.3%). Arguably, oil demand
continues to be boosted by the government’s stimulus programme, but as this report has repeatedly
noted, some of this rise may be also related to stockpiling in anticipation of domestic price increases.

kb/d China: Naphtha Demand kb/d China: Jet Fuel & Kerosene Demand
1,200 450
1,100 400
1,000
350
900
300
800
700 250
600 200
2008 2009 2008 2009

China: Demand by Product

(tho usand barrels per day)
D e m a nd A nnua l C hg ( k b/ d) A nnua l C hg ( %)
2008 2009 2010 2009 2010 2009 2010
LPG & Ethane 653 735 792 82 57 12.6 7.8
Naphtha 768 902 957 134 55 17.4 6.1
Motor Gasoline 1,493 1,542 1,668 49 126 3.3 8.2
Jet & Kerosene 292 342 359 50 17 17.3 5.0
Gas/Diesel Oil 2,837 2,739 2,875 -99 137 -3.5 5.0
Residual Fuel Oil 603 592 602 -11 10 -1.9 1.7
Other Products 1,246 1,562 1,465 316 -97 25.3 -6.2
Total Products 7,892 8,413 8,718 521 305 6.6 3.6

Given these higher‐than‐expected figures, we have revised up once again our demand forecast by
roughly 80 kb/d on average for both this year and next. Total oil demand is now expected to average
8.4 mb/d in 2009 (+6.6% or +520 kb/d) and 8.7 mb/d in 2010 (+3.6% or +300 kb/d). However, these
prognoses may be revised again next month. The severe snowstorms and the accompanying cold snap
that hit northern and north‐western China in early November reportedly disrupted coal, oil products and
natural gas deliveries, and forced the closure of highways and roads. This may translate into weaker‐
than‐expected demand for that month. Still, it is worth noting that Chinese demand growth is on track
this year to match the last surge (in 2006: +550 kb/d) – and the highest growth of any country during a
recession year.

Who’s (Not) Driving?
Chinese apparent demand data feature some odd trends. The most glaring is the seeming mismatch
between subdued gasoline demand and surging car sales, which we have highlighted over the past few
months. We have argued that this inconsistency is probably largely related to incomplete data (notably the
lack of inventory figures and possibly missing or understated estimates from independent retailers), but
other observers have proposed alternative explanations.
Some contend that the reason behind subdued gasoline demand is simply due to a dramatic efficiency
improvement, as small cars have accounted for over two‐thirds of total sales given higher sales taxes on
bigger engines and rising retail gasoline prices. A variant of this argument is that, since tax incentives on
small cars are due to expire by year‐end, consumers are rushing to buy new cars or replace existing, less
efficient ones even if they do not really intend to use them for the time being. Along the same lines, other
analysts suggest that local governments and state‐owned companies have been ordered to purchase cars in
order to support local manufacturers, but that these vehicles are sitting idle in car parks.
Some behavioural explanations have also been advanced. One posits that Chinese motorists drive
intrinsically less than elsewhere. Cars would serve primarily to enhance the social status of their owners,
who typically would use them only during the weekend, preferring public transportation during the working
week, notably in large urban areas (in Beijing, for example, all private vehicles are not allowed to circulate
one day per week based on their number plates’ last digit). Another explanation is that some sales reflect
second‐car purchases by wealthy households, and these vehicles would also tend to be driven only on an
occasional basis.
However, as compelling as these explanations may be, they remain largely anecdotal, while some appear to
be contradictory. As much as efficiency may have improved, the sheer volume of car sales should arguably
point towards much higher gasoline demand than currently inferred from official statistics. Moreover, sales
of big, gas‐guzzling imported cars have also increased strongly (albeit at a slightly lower pace than domestic
ones), thus somewhat downplaying the alleged price sensitivity of Chinese consumers. In addition, the
central government has frozen expenditures of new cars and has strongly encouraged local governments to
follow suit, thus casting doubts on its supposed willingness to support the local industry at all costs. Finally,
the behavioural explanations are virtually impossible to assess, although they may become retrospectively
clearer in a few years. Yet the mystery remains unsolved: are the Chinese highly circumspect about driving,
has the vehicle fleet become extremely efficient or is gasoline demand under‐reported?

Other Non-OECD
India’s oil product sales – a proxy of demand – surged by 8.4% year‐on‐year in October, according to
preliminary data. This strong performance, reflecting the country’s remarkable economic resilience, was
mostly due to buoyant growth across all product categories bar naphtha, particularly LPG (+10.8%),
gasoline (+18.6%), gasoil (+12.4%) and ‘other products’ (+16.4%). By contrast, naphtha demand was
reported to have declined by 23.3% given greater natural gas availability to utilities, fertiliser producers
and steel plants. However, as we have often noted in this report, naphtha preliminary figures are usually
revised up (+70 kb/d in September, showing that demand actually expanded by +2.3% rather than
declining by 20.8% as previously assessed). Therefore, the much‐anticipated structural decline in
naphtha demand is so far proving elusive.

The rise in gasoline demand is noteworthy. October car sales increased at their fastest pace in over two
years (+34% year‐on‐year), helped by cheap credit. In addition, the Diwali holidays, which traditionally
boost domestic travel, fell in mid‐October. Meanwhile, the strength of gasoil demand was largely driven by
farmers in key grain producing states, where the fuel is used to run water pumps and power generators.

kb/d India: Total Oil Product Demand kb/d India: Motor Gasoline Demand
3,600 350
3,400
3,200 300
3,000
250
2,800
2,600 200
2,400
2,200 150
2008 2009 2008 2009

The government has taken some tentative steps to address the issue of fuel subsidies, which have again
become a pressing concern as international oil prices hover around $75/bbl. Short of moving to abolish
them, the Ministry of Petroleum & Natural Gas has reportedly launched a pilot project in three cities
(Pune in Maharashtra, Hyderabad in Andhra Pradesh and Bangalore in Karnataka) to allocate kerosene
and domestic LPG – two fuels used by the majority of the population – via smart cards, targeting the
population quintiles that truly need subsidised fuel. If the project proves successful, smart cards will be
introduced throughout the country. In addition, the government may implement dual pricing for
transportation fuels, but such a decision is not expected before year‐end.

India: Demand by Product
2008 2009 2010 2009 2010 2009 2010
LPG & Ethane 407 423 439 15 16 3.8 3.8
Naphtha 310 319 283 8 -35 2.7 -11.1
Motor Gasoline 265 303 333 38 30 14.5 9.9
Jet & Kerosene 299 299 306 0 7 0.0 2.4
Gas/Diesel Oil 1,078 1,162 1,246 84 84 7.8 7.2
Residual Fuel Oil 395 399 397 4 -1 1.1 -0.3
Other Products 381 394 401 13 7 3.5 1.7
Total Products 3,134 3,299 3,405 164 106 5.2 3.2


In early December, Russia’s Federal Anti‐Monopoly Service (FAS) announced a deal with the country’s oil
companies aimed at working out a price formula to set ‘fair’ domestic oil product prices. This comes
after almost a year of investigations – and heavy fines – against Russia’s majors, both private and state‐
owned, for alleged manipulation of retail prices. (The vertically‐integrated majors reportedly control
sales in 57 out of the country’s 89 regions, despite owning less than half of total retail outlets.)
According to the agreement, a specific domestic refinery (yet to be determined) will be chosen as a
benchmark for a new price formula, which will eventually also incorporate international prices (possibly
oil product prices in Rotterdam, although some companies argue in favour of pegging domestic prices to
several, rather than just one, international benchmarks).

Russia: Total Oil Product Demand Russia: Motor Gasoline Demand
kb/d kb/d
S o urc e : P e t ro m a rk e t R G , IE A S o urc e : P e t ro m a rk e t R G , IE A
3,100 800
3,000 750
2,900
700
2,800
650
2,700
2,600 600
2,500 550
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2006 2007 2008 2009 2006 2007 2008 2009

This solution appears to discard an earlier proposal to oblige oil companies to trade at least 15% of their
domestically‐oriented output through Russia’s three commodity exchanges (which currently handle less
than 2% of the country’s total oil product sales). Moreover, it is unclear whether another FAS proposal
to achieve ‘fair’ prices – by forcing companies to dispose of their retail operations – will be implemented.
Interestingly, Russian motorists seem unconcerned by these price issues, judging by the fact that
gasoline has remained buoyant. By contrast, overall oil demand plummeted as the country entered into
a severe recession last year.

Russia: Demand by Product
2008 2009 2010 2009 2010 2009 2010
LPG & Ethane 326 296 315 -30 19 -9.3 6.5
Naphtha 253 237 248 -16 12 -6.4 4.9
Motor Gasoline 720 727 762 7 35 0.9 4.8
Jet & Kerosene 248 219 231 -29 12 -11.7 5.3
Gas/Diesel Oil 626 587 611 -39 24 -6.2 4.0
Residual Fuel Oil 286 218 257 -68 40 -23.9 18.3
Other Products 431 409 448 -22 38 -5.1 9.3
Total Products 2,890 2,692 2,871 -198 179 -6.8 6.6
Source: Petromarket RG, IEA


I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT S UPPLY
SUPPLY

Summary
• Global oil supply rose by 200 kb/d in November, two‐thirds of which came from OPEC. Year‐on‐year,
global supply is down marginally, with lower OPEC output mostly offset by higher non‐OPEC
production. Largely as a result of lower non‐OPEC supply prospects for 2010, next year’s call on OPEC
is raised by 0.5 mb/d to 29 mb/d, compared with 28.7 mb/d in 2009.

• OPEC production rose 135 kb/d in November, to 29.1 mb/d, led by a sharp rebound in Nigerian
output amid improved security following the government’s October ceasefire agreement with rebel
forces. OPEC‐12 production is now at the highest level in a year and up by 1 mb/d from the group’s
February low of 28.1 mb/d. OPEC ministers are scheduled to meet in Angola on 22 December to
discuss output targets.

• Forecast non‐OPEC supply in 2009 is nudged up to 51.3 mb/d (+125 kb/d versus last month’s report),
as the quietest US hurricane season since 1997 came to a close. In addition, a review of global NGL
capacity brings an upward adjustment to Russian and other gas liquids output in 2009. In contrast, for
2010, lower North American NGL and US GOM crude prospects more than offset higher Russian NGL,
with total supply now revised down by 265 kb/d to 51.6 mb/d.

• Updated medium‐term global supply capacity projections show an upward adjustment of 1.1 mb/d
on average in 2008‐2014, weighted to the latter half of the forecast period. OPEC’s crude capacity
growth was revised up largely on a stronger outlook for Nigeria and Iraq, now forecast to rise by
2.8 mb/d, to 36.9 mb/d. OPEC NGLs were also slightly higher, with capacity now forecast to increase
by 2.8 mb/d, to 7.3 mb/d. Non‐OPEC supply prospects have improved, now forecast to grow by
0.7 mb/d compared with a previous decline of 0.4 mb/d in 2008‐2014 period.

m b/d OPEC and Non-OPEC Oil Supply m b/d OPEC and Non-OPEC Oil Supply
Year-on-Year Change (OPEC Current Membership)
3.0 60 33
2.0 58 32
1.0 56 31
0.0 54
30
-1.0 52
-2.0 50 29
-3.0 48 28
-4.0 46 27
Nov 08 Feb 09 May 09 Aug 09 Nov 09 Jan 08 Jul 08 Jan 09 Jul 09 Jan 10 Jul 10
OPEC Crude Non-OPEC Non-OPEC OPEC NGLs
OPEC NGLs Total Supply OPEC Crude - RS

All world oil supply figures for November discussed in this report are IEA estimates. Estimates for OPEC
countries, Alaska, Indonesia and Russia are supported by preliminary November supply data.

Note: Random events present downside risk to the non‐OPEC production forecast contained in this report.
These events can include accidents, unplanned or unannounced maintenance, technical problems, labour strikes,
political unrest, guerrilla activity, wars and weather‐related supply losses. Specific allowance has been made in
the forecast for scheduled maintenance in all regions and for typical seasonal supply outages (including
hurricane‐related stoppages) in North America. In addition, from July 2007, a nationally allocated (but not field‐
specific) reliability adjustment has also been applied for the non‐OPEC forecast to reflect a historical tendency
for unexpected events to reduce actual supply compared with the initial forecast. This totals ‒410 kb/d for non‐
OPEC as a whole, with downward adjustments focused in the OECD.

S UPPLY I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT
OPEC Crude Oil Supply

OPEC production inched higher in November, up by 135 kb/d to 29.1 mb/d, led by a sharp rebound in
Nigerian output amid improved security following the government’s October ceasefire agreement with
rebel forces. OPEC‐12 production is now at the highest level in a year and up by 1.0 mb/d from the
group’s February low of 28.1 mb/d.

Crude oil production by OPEC‐11 rose by 90 kb/d to 26.6 mb/d in November with the group now
producing about 1.8 mb/d above its 24.845 mb/d output target. Relative to targeted output cuts, OPEC’s
compliance rate slipped to just 58% in November compared with 60% in October.

Iran and Angola continue to top the list of overproducers, collectively accounting for 40% of above target
output. Iran’s production increased by 40 kb/d to 3.7 mb/d, with the country’s target compliance
slipping to just 20% in November. Angolan production was 25% above its implied target of 1.5 mb/d.
OPEC’s newest member continues to argue its output target allocation in place since September 2008 is
too low. Angola’s less‐than‐stellar compliance level may prove awkward at OPEC’s 22 December
meeting taking place in the country’s capital.

OPEC Crude Oil Production
m b/d Quarterly Call on OPEC Crude +
33 m b/d
Stock Change
32
32
31
30
30
29 28
28 26
27
24
Jan Mar May Jul Sep Nov Jan
1Q 2Q 3Q 4Q
2006 2007
2008 2009 2008 2009 2 0 10
Entire series based o n OP EC Co mpo sitio n as o f January 2009 Entire series based o n OP EC Co mpo sitio n as o f January 2009
o nwards (including A ngo la & Ecuado r & excluding Indo nesia) o nwards (including A ngo la & Ecuado r & excluding Indo nesia)

Despite weakening compliance with output targets, pre‐meeting statements by OPEC ministers suggest
the group is comfortable with current levels of both oil production and crude prices. With oil prices
hovering around $75/bbl in November and early December, a consensus appears to favour rolling over
current output targets. OPEC may be calculating that a recovery in oil demand in 2010 will quickly
reduce the relatively high levels of global crude and refined product stocks. Indeed, OPEC may be
banking on stronger winter demand for its crude judging by higher customer contract allocations for
December and tanker tracking reports which show higher exports this month.

Saudi Arabia’s production was estimated at 8.28 mb/d in November, unchanged from the upward
revised October level. The higher levels are in line with previously announced increased contract
allocations for some customers in Asia for December. Above‐target output also continues to be used for
domestic use at power plants. The substitution of lighter quality crude instead of fuel oil partly reflects
the Kingdom’s new environmental regulations calling for cleaning burning feedstock.

Nigeria’s output rose to the highest level in 15 months and accounted for around 60% of the group’s
increase in November. Production rose 80 kb/d, to just under 2 mb/d in November, as companies
stepped up the pace of repair work to damaged oil infrastructure with the ceasefire agreement holding.
Nigeria’s oil minister estimated that the country could bring back onstream some 500 kb/d of shut‐in
production by the end of 2010 (see Medium‐Term OPEC Capacity).


Medium-Term OPEC Capacity Update: Nigeria and Iraq Key to Stronger Increases
The unexpected success of the Nigerian government’s OPEC Crude Oil Capacity
mb/d
ceasefire accord with key rebel groups, Iraq’s tangible
progress in awarding technical service agreements to IOCs 37
and new development plans in Angola are behind our 36
upward revision to the outlook for OPEC production
capacity published in the June MTOMR. OPEC crude 35
production capacity over the 2008‐14 period is now
34
forecast to rise by 2.8 mb/d, to 36.9 mb/d. This
represents a revision of +1.1 mb/d compared with last 33
June’s outlook for capacity growth of 1.69 mb/d. 2008 2009 2010 2011 2012 2013 2014
OPEC’s condensate and natural gas liquids (NGL) capacity Previous Forecast Current Forecast
has also been raised, by a smaller 175 kb/d, with growth

now forecast at 2.79 mb/d, to 7.3 mb/d.
Nigeria’s Reversal of Fortune
Nigeria’s eleventh hour victory in securing a ceasefire agreement with militant groups holds the promise of a
significantly improved operating environment for IOCs after years of debilitating attacks on the country’s oil
production infrastructure. Nigeria’s oil minister estimated that the country could bring back on stream
some 500 kb/d of shut‐in production next year. Those projections are in line with our previous estimate of
500‐600 kb/d of available capacity that could be restored in the short term. For the 2008‐14 forecast period,
Nigeria’s production capacity has been revised higher by 386 kb/d from the June report, with output levels
now expected to increase by 370 kb/d versus a previous decline of 20 kb/d. Nigeria’s production capacity is
forecast to reach 2.9 mb/d by 2014. In the near term, restoration of shut‐in production will be augmented
by a ramp up in the Agbami field next year.
Before the ceasefire, Nigerian production fell to the lowest level in more than two decades in August but
output is on track to breach the 2 mb/d mark in December as companies fast track repair work on damaged
infrastructure. The medium‐term outlook critically hinges on the government’s success in rehabilitating the
former militants and improving the living conditions in the Niger Delta region. A similar amnesty offer based
on a cash‐for‐arms program under then President Obasanjo in 2004 collapsed because the government
failed to deliver on promises or follow through with a sustainable development plan. As a result, militants
groups reorganised under new leaders and rearmed, ushering in a new wave of violence and disruption.
This time, however, the government has significantly increased spending in the region, earmarking roughly
$1.3 bn for post‐amnesty development projects, including building roads, schools and hospitals as well as
proposing to allocate 10% of revenues from its oil joint ventures to residents in the Niger Delta.
Estimated Average Sustainable Crude Production Capacity

(million barrels per day)
Increment
2008 2009 2010 2011 2012 2013 2014 08 - 14
Algeria 1.42 1.39 1.40 1.49 1.60 1.68 1.73 0.31
Angola 1.94 2.03 2.05 2.04 2.08 2.25 2.52 0.58
Ecuador 0.50 0.49 0.48 0.45 0.43 0.41 0.39 (0.11)
Iran 3.97 3.97 3.92 3.78 3.69 3.61 3.48 (0.49)
Kuwait 2.63 2.62 2.59 2.55 2.52 2.64 2.69 0.06
Libya 1.78 1.77 1.78 1.81 1.78 1.80 1.97 0.19
Nigeria 2.48 2.66 2.71 2.70 2.63 2.67 2.85 0.37
Qatar 0.88 0.93 1.00 1.02 1.00 0.98 0.96 0.08
Saudi Arabia 10.74 11.23 12.16 12.04 11.83 11.79 11.97 1.23
UAE 2.72 2.72 2.71 2.75 2.88 2.99 3.06 0.34
Venezuela 2.62 2.51 2.42 2.33 2.25 2.22 2.20 (0.42)
OPEC-11 31.68 32.33 33.21 32.97 32.69 33.02 33.81 2.13
Iraq 2.47 2.48 2.45 2.40 2.50 2.74 3.09 0.62
Total OPEC 34.15 34.81 35.66 35.37 35.19 35.75 36.90 2.76
Increment 0.51 0.67 0.85 -0.29 -0.18 0.56 1.15


Medium-Term OPEC Capacity Update (continued)
The administration has also enlisted support from companies operating in the country. In tandem with
government officials, Shell launched training programmes in November for former militants. The European
Union and South Korea, among others, have also offered financial assistance to provide training and build
infrastructure for the impoverished oil‐producing region.
mb/d Nigerian Crude Oil Production Capacity
While the prospect for securing peace with rebel groups looks
2.9
more promising than at any time in the past, Nigeria’s 2.8
controversial ‘Petroleum Industry Bill (PIB)’ may yet derail 2.7
2.6
production capacity expansion plans. Nigerian lawmakers are 2.5
pushing forward with plans to pass legislation a decade in the 2.4
making aimed at restructuring the state oil company to put it 2.3
2.2
on a profit‐making footing capable of meeting funding 2.1
commitments with its joint venture partners. At the same 2.0
time, the proposed legislation would allow the government to 2008 2009 2010 2011 2012 2013 2014
renegotiate old contracts, including offshore oil production Previous Forecast Current Forecast
contracts from the 1993 bid round, and impose higher
royalties and taxes. Negotiations are ongoing and we assume for our forecast that a positive outcome for the
government and companies will prevail, allowing stalled capacity expansion plans to move forward.
Navigating Iraqi Minefields
Iraqi production capacity is forecast to rise by just over 600 kb/d, to 3.1 mb/d by 2014. That is an upward
revision of 390 kb/d from our June forecast in light of the progress made on contract awards and the
pressing imperative to increase revenues. However, the many political and security risks that continue to challenge
the government and industry remain, leaving our outlook
extremely vulnerable to future revision. Iraq’s three‐track mb/d Iraqi Crude Oil Production Capacity
strategy to boost oil production in the short term has met 3.2
with mixed success. The enhanced drilling programmes by 3.0
the Southern Oil Company (SOC) and the Northern Oil 2.8
Company (NOC) have so far failed to increase production as
2.6
planned. The joint venture between the Iraq Drilling Company
2.4
and Mesopotamia Petroleum Company (UK) collapsed for
2.2
lack of funding, underscoring the difficulties the national
2.0
companies have had in ramping up production on their own.
2008 2009 2010 2011 2012 2013 2014
The first bidding round for Technical Service Contracts
Previous Forecast Current Forecast
(TSCs) for fields currently in production ended in only one
contract being signed for the much coveted Rumaila field.
On paper, the contract calls for production to rise from the current 1.0 mb/d to 2.85 mb/d. Negotiated
Engineering, Procurement and Construction (EPC) contracts with IOCs are also near being concluded for
Nasseriya, Zubair and West Qurna. The deals in the pipeline are aimed at increasing capacity to 7.0 mb/d.
The second international licensing round, which focuses on undeveloped fields under TSCs, is scheduled for
11‐12 December, and includes the Majnoon and West Qurna Phase‐2. The second bid round is expected to
increase production by a further 3 mb/d, with the ministry forecasting production capacity to reach 10 mb/d
by 2018‐20. However, the production targets are arguably very ambitious and are near impossible to reach
in the announced time frame given political, logistical and technical hurdles. Clarity on the contract awards
may emerge following the country’s elections now planned for early March. However, a significant increase
in violence and bombings leading up to the elections are already causing security problems for the second
bid round, highlighting the overwhelming security issues for companies.
Equally important, logistical constraints on the country’s export capacity in the medium term are a
formidable issue that urgently needs to be addressed if the country is to move forward with its expansion
plans. Experts estimate that current capacity constraints will limit exports to under 3.0 mb/d until major
infrastructure work can be completed in the southern region, with 2013‐14 the earliest expansion work
would be completed. Our updated forecast sees annual production capacity holding flat at around 2.5 mb/d
in the near term and then rising to 2.7 mb/d in 2013 and to 3.1 mb/d in 2014.

Crude oil production in Iraq also increased last month despite further attacks on the northern export
pipeline and weather‐related delays disrupting southern shipments. Production rose 45 kb/d, to 2.5 mb/d
last month, with exports pegged at 1.96 mb/d. Exports of Basrah crude were up 65 kb/d, to 1.56 mb/d
even as shipments from the south were hampered by loading delays during the last week of the month
due to bad weather. Exports of Kirkuk crude from the north were unchanged from October’s levels at
around 375 kb/d. Iraqi production estimates include 550 kb/d of crude used for refinery operations and
at power plants as well as an estimated 20 kb/d of output in the Kurdish region of the country.
OPEC Crude Production
Percent
Sustainable Spare Capacity
Sep 2009 Oct 2009 Nov 2009 OPEC Compliance
Production vs Nov 2009
Supply Supply Supply 1 Target Cuts with Volume
Capacity Supply
Cuts
Algeria 1.22 1.24 1.24 1.40 0.16 0.200 65%
Angola 1.86 1.90 1.90 2.10 0.19 0.244 0%
Ecuador 0.46 0.46 0.46 0.50 0.04 0.067 57%
Iran 3.70 3.66 3.70 4.00 0.30 0.562 20%
Kuwait2 2.23 2.27 2.27 2.65 0.38 0.374 91%
Libya 1.55 1.52 1.52 1.77 0.25 0.252 71%
Nigeria3 1.85 1.90 1.98 2.60 0.62 0.319 0%
Qatar 0.76 0.77 0.77 0.90 0.13 0.122 74%
Saudi Arabia2 8.19 8.28 8.28 11.60 3.32 1.318 89%
UAE 2.27 2.28 2.27 2.85 0.58 0.379 100%
Venezuela4 2.24 2.24 2.22 2.40 0.18 0.364 41%
OPEC-11 26.33 26.52 26.61 32.77 6.15 4.201 58%
Iraq 2.51 2.47 2.52 2.60 0.09
Total OPEC 28.84 28.99 29.13 35.37 6.24
(excluding Iraq, Nigeria, Venezuela 5.35)

1 Capacity levels can be reached within 30 days and sustained for 90 days.
2 Includes half of Neutral Zone production.
3 Nigeria excludes some 0.5 mb/d of shut-in capacity.
4 Includes upgraded Orinoco extra-heavy oil assumed at 460 kb/d in November.

Venezuela’s November output declined by 20 kb/d, to 2.2 mb/d, reflecting technical problems at two of
the country’s extra‐heavy oil upgrading plants, Petrocedeno (165 kb/d) and Petroanzoategui (135 kb/d).
As a result, upgraded Orinoco oil averaged 460 kb/d in November, down 20 kb/d from October levels.

Non-OPEC Overview
Revisions to short‐term non‐OPEC supply this month stemmed mainly from baseline changes to natural
gas liquids (NGL), while recent reported data contained few surprises. Tropical Storm Ida brought the US
hurricane season to an end, only briefly shuttering Gulf of Mexico production, though by less than we
had already deducted on the basis of five‐year average outages, thus nudging up the US baseline. In the
process of updating our medium‐term outlook, project start‐up dates have been reviewed, while in
addition, we undertook a wide‐ranging reappraisal of NGL production figures (see Medium‐Term
Non-OPEC Supply
1Q08 2Q08 3Q08 4Q08 2008 1Q09 2Q09 3Q09 4Q09 2009 1Q10 2Q10 3Q10 4Q10 2010
North America 14.2 14.0 13.6 13.8 13.9 14.2 13.9 14.2 14.3 14.1 14.2 13.9 13.5 13.9 13.9
Europe 4.9 4.8 4.5 4.8 4.8 4.9 4.5 4.2 4.3 4.5 4.3 3.9 3.8 4.0 4.0
Pacific 0.6 0.7 0.7 0.7 0.6 0.7 0.6 0.7 0.7 0.7 0.7 0.8 0.8 0.8 0.8
Total OECD 19.7 19.5 18.8 19.3 19.3 19.7 19.0 19.0 19.2 19.2 19.2 18.6 18.1 18.7 18.6
Former USSR 12.9 12.9 12.7 12.7 12.8 13.0 13.2 13.3 13.6 13.3 13.7 13.9 13.7 13.9 13.8
Europe 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1
China 3.8 3.8 3.8 3.8 3.8 3.7 3.8 3.8 3.9 3.8 4.0 4.0 4.0 4.1 4.0
Other Asia 3.7 3.6 3.6 3.7 3.7 3.6 3.6 3.6 3.6 3.6 3.7 3.7 3.8 3.8 3.7
Latin America 4.1 4.1 4.2 4.2 4.1 4.3 4.3 4.3 4.4 4.3 4.5 4.5 4.6 4.7 4.6
Middle East 1.6 1.6 1.6 1.6 1.6 1.7 1.7 1.7 1.6 1.6 1.6 1.6 1.6 1.6 1.6
Africa 2.6 2.6 2.6 2.5 2.6 2.5 2.5 2.5 2.5 2.5 2.5 2.4 2.4 2.4 2.4
Total Non-OECD 28.8 28.8 28.7 28.7 28.7 29.0 29.2 29.4 29.7 29.3 30.1 30.3 30.2 30.6 30.3
Processing Gains 2.2 2.2 2.3 2.3 2.2 2.3 2.3 2.3 2.3 2.3 2.2 2.2 2.2 2.2 2.2
Other Biofuels 0.3 0.4 0.4 0.4 0.4 0.3 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5 0.5
Total Non-OPEC 51.0 50.9 50.1 50.7 50.7 51.3 50.9 51.2 51.7 51.3 52.0 51.6 51.1 52.0 51.6
Annual Chg (mb/d) -0.2 -0.1 -0.3 -0.2 -0.2 0.3 0.0 1.1 1.0 0.6 0.7 0.7 -0.1 0.3 0.4
Changes from last OMR (mb/d) 0.1 0.1 0.0 0.0 0.0 0.1 0.1 0.2 0.1 0.1 -0.1 -0.1 -0.4 -0.5 -0.3

Non‐OPEC Supply Update: Higher Baseline, More Optimistic Outlook). The net result for total non‐OPEC
supply is an upward revision of 125 kb/d to 2009, now forecast to average 51.3 mb/d, and a downward
revision of 265 kb/d to 2010, now seen growing to 51.6 mb/d.

Medium-Term Non-OPEC Supply Update: Higher Baseline, More Optimistic Outlook
A series of monthly upward revisions, a more optimistic view on project start‐up dates and a wide‐reaching
reappraisal of natural gas liquids (NGL) have led to substantial upward revisions to our medium‐term non‐
OPEC supply figures. Total output is now expected to grow 0.7 mb/d from 2008 to 2014, reaching
51.4 mb/d, compared with a decline of 0.4 mb/d forecast in June’s MTOMR.
The single largest contribution to the higher forecast comes from Russia’s unexpectedly robust crude production
in 2009. Compared with earlier in the year, when this report and most others were still anticipating a decline in
2009 Russian crude output, monthly production figures have
mb/d Total Non-OPEC Supply
disproved this, as new fields ramped up earlier and faster than 52.5
expected, encouraged by a recovery in oil prices and some well‐
52.0
timed fiscal incentives. Our outlook now expects Russian crude
output to rise for a second year running in 2010, but then to 51.5
drop, as decline at mature fields outweighs new start‐ups. 51.0
The outlook for supply overall has improved, with a higher 50.5
price assumption (around $75/bbl on average for 2010‐2014,
in real terms) and a widespread perception that the worst of 50.0
2008 2009 2010 2011 2012 2013 2014
the global economic crisis is over. It appears that upstream
Dec 2009 MTOMR June 2009 MTOMR
investments have not been cut as sharply as feared earlier in
the year, though costs, too, may not have fallen as much as anticipated and overall, it is fair to say that many
upstream projects are back on the drawing board again. This is certainly true for Canadian oil sands, which
(as in June’s MTOMR) are forecast to show the strongest growth over the forecast period. But earlier‐than‐
assumed starting dates at projects have also boosted the outlook for Brazil, Colombia, Kazakhstan, Oman
and others. In the US, the absence of any significant hurricane shut‐ins this season has raised baseline
production in the near term. Partly offsetting these adjustments, downward revisions were made in Mexico,
Indonesia, Brazilian fuel ethanol and Ivory Coast.
mb/d Non-OPEC Supply: Change 2008-14 mb/d Change in Russia Crude Forecast
1.20 10.0
0.80 9.8
0.40 9.6
0.00 9.4
-0.40 9.2
-0.80 9.0
8.8
8.6
2008 2009 2010 2011 2012 2013 2014
Dec 09 MTOMR Jun 09 MTOMR

NGL projections have been recalibrated to reflect the latest IEA gas production forecast, which has led to
numerous adjustments, both for baseline and outlook profiles. The resulting aggregate downward revision
is quite small for current output levels though greater towards the tail‐end of the forecast, while changes to
individual countries are significant. Notably, Russia’s NGL baseline is upped by 50 kb/d and both gas plant
liquids and condensate output are expected to grow much more strongly than previously forecast,
collectively rising by 50% from current levels. The main factor supporting Russian NGL production growth is
higher utilisation of associated gas as a result of curbs to flaring and ongoing investments in the midstream
sector, as well as a higher liquids ratio of non‐associated Russian gas as it is produced from deeper
reservoirs. Conversely, forecast NGL production in the US and Canada is curbed sharply, with output now
expected to decline a combined 100 kb/d over the forecast period, on the basis of a less optimistic North
American gas production forecast. Other noteworthy upward revisions include Argentina, India, Kazakhstan,
Malaysia, Norway, Peru, Thailand and Uzbekistan, while downward adjustments affect Australia, Indonesia,
Oman and Tunisia. (A detailed review of global gas liquids prospects (to be presented in full in 2010).)

OECD
North America
US – November Alaska actual, others estimated: September and October US production were revised
up by around 140 kb/d on average, as was November, though by a lower 50 kb/d. Officially, the
hurricane season came to an end on 30 November, the quietest since 1997 in terms of number of named
storms, largely due to the presence of El Niño. Tropical Storm Ida, the only storm this year to cause oil
production shut‐ins, ultimately only knocked out 50 kb/d of Gulf of Mexico output for November, as
despite forcing the precautionary closure of 43% of regional production, operations were resumed only
days later. This report had previously assumed an average November shut‐in volume of 180 kb/d and a
lingering 50 kb/d in December. The hurricane season’s passing prompted the elimination of these
adjustments and henceforth, recalculated five‐year average outages of 210 kb/d and 240 kb/d
respectively for the third and fourth quarters.

mb/d US Crude Oil Supply mb/d US NGL Supply
5.80 2.00
1.90
5.30
1.80
4.80
1.70
4.30
1.60
3.80 1.50
Jan Mar May Jul Sep Nov Jan Jan Mar May Jul Sep Nov Jan
2007 2008 2007 2008
2009 Forecast 2009 2009 Forecast 2009
2010 Forecast 2010 Forecast

Forecast NGL output was reduced by a sharp 140 kb/d for 2010 and similar volumes thereafter on the
basis of a reassessed gas forecast. Some changes were made to crude project start‐up dates, especially
in the Gulf of Mexico, resulting in downward revisions there of ‐20 kb/d and ‐165 kb/d for 2009 and 2010
respectively. Nonetheless, the Gulf of Mexico is still forecast to contribute 410 kb/d of incremental
output this year. Even slightly offset by lower crude production elsewhere, US total net crude growth of
355 kb/d in 2009 should be the highest year‐on‐year increase since 1978. Added to growth in NGLs and
biofuels, US total oil production increases by 525 kb/d to just over 8 mb/d in 2009. 2010 total US oil
production is now forecast at a lower 7.9 mb/d.

Canada – Newfoundland – October actual, others September actual: September production was
revised down nearly 50 kb/d on lower‐than‐expected output across the board. Lower NGL production
likely stems from curbed natural gas output, while the Terra Nova oil field offshore Newfoundland has
been at a reduced output level since August. As part of our NGL reappraisal, Canadian forecast
production is adjusted down by around 90 kb/d for 2010‐2014. Total Canadian liquids production is
forecast to rise from 3.1 mb/d in 2009 to 3.2 mb/d in 2010.

Mexico – October actual: October oil production in Mexico was higher than expected and flat month‐
on‐month, as production at key oil fields Cantarell and Ku‐Maloob‐Zaap (KMZ) was unchanged. The last
couple of months have seen previously‐steep decline at Cantarell slow, though we still envisage a further
drop in coming months and years. Looking ahead, the recent government decision to slash investment
at the Chicontepec field leads us to project a slower ramp‐up towards the tail‐end of our medium‐term
forecast period. In the shorter term, oil output for both 2009 and 2010 are revised up minimally, now
forecast to average 3 mb/d and 2.8 mb/d respectively.


Better Biofuels Prospects in the Medium Term
The global biofuels production outlook has improved since our June 2009 MTOMR forecast. For 2008‐2014,
biofuels production has been revised up on average by 35 kb/d annually, with the largest adjustments in the
2009‐2011 timeframe. We now see 2009 global biofuels production at 1.6 mb/d, up 105 kb/d from 2008 and
40 kb/d higher than in the MTOMR. Over the medium
term, we see global output increasing to 2.2 mb/d, with mb/d Global Biofuels Supply
annual growth from 2008‐2014 averaging 120 kb/d, similar 2.4
to what we foresaw in June. 2.0
1.6
The headline revisions mask more significant underlying
changes. US ethanol production in 2Q09 and 3Q09 came 1.2
in higher than expectations, buoyed by more favourable 0.8
production margins. Many producers remain vulnerable 0.4
to ongoing industry consolidation and capacity surpluses 0.0
remain, but utilisation has improved since 1H09 and 2008 2009 2010 2011 2012 2013 2014
some formerly shut plants have returned to duty. We OECD EUR Biodiesel Other Biodiesel
expect US ethanol output at 690 kb/d in 2009, growing to Other Ethanol Brazil Ethanol
US Ethanol
835 kb/d in 2014. Still, uncertainty surrounds the
introduction of E15. While the US Environmental Protection Agency (EPA) has positively signalled the ability
of vehicles built after 2001 to handle a 15% ethanol blend (versus a current 10% limit), EPA recently delayed
its ruling until next summer. We continue to doubt that the US will be able to meet its Renewable Fuel
Standard for cellulosic ethanol, which envisages 7 kb/d of usage in 2010 and 115 kb/d by 2014.
World Biofuels Production
(thousand barrels per day)
2008 2009 2010 2011 2012 2013 2014

OECD North America 669 745 847 896 919 920 920
United States 652 722 819 865 885 885 885
OECD Europe 192 200 229 247 261 262 263
OECD Pacific 7 5 8 12 14 15 15
Total OECD 868 950 1,084 1,155 1,195 1,197 1,198
FSU 3 2 3 9 11 11 11
Non-OECD Europe 3 5 5 5 5 5 5
China 32 32 35 41 43 43 43
Other Asia 35 44 64 86 98 98 98
Latin America 519 531 583 629 691 751 816
Brazil 493 502 547 592 647 705 770
Middle East 0 0 0 0 0 0 0
Africa 1 2 3 5 5 7 7
Total Non-OECD 594 617 693 775 854 916 982
Total World 1,461 1,567 1,776 1,930 2,049 2,113 2,180
In Latin America, ethanol and biodiesel production fortunes have diverged. We revised down Brazilian
ethanol output from 2008‐2014 on average by 60 kb/d as high sugar prices, challenging harvest conditions
and reduced capacity expansion undermined production levels. In 2009 we see output at 475 kb/d,
unchanged from 2008. Despite the lower baseline, however, medium‐term growth still appears strong to
meet expanding domestic consumption and an ever‐expanding flex‐fuel vehicle fleet; 2014 output is
expected near 730 kb/d. Biodiesel output, by contrast, has been revised up in both Brazil and Argentina,
boosted by rising domestic consumption in the former and increased transatlantic export opportunities for
the latter. Latin American biodiesel production is seen at 50 kb/d in 2009, rising to over 75 kb/d in 2014.
In OECD Europe, favourable wheat prices improved margins for ethanol producers, prompting higher 2009
production than previously anticipated. The baseline revision has prompted higher output on average by
10 kb/d from 2008‐2014. Despite the imposition of tariffs on biodiesel coming from the US, European
biodiesel production from 2008‐2014 is virtually unchanged with imports from Argentina and SE Asia having
filled the gap in the near term. Some sizeable biofuel capacity additions are on the horizon for 2010‐2012,
which should boost European total biofuels production from 200 kb/d in 2009 to 265 kb/d in 2014. Still,
market access uncertainties remain for both foreign and domestic producers. The European Commission is
due in 2010 to propose sustainability criteria legislation that accounts for the impacts of indirect land‐use
change on biofuels greenhouse gas savings versus fossil fuels.

North Sea
Norway – September actual, October provisional: Norwegian October output was revised down by
50 kb/d, despite including first reported output from new fields 33/9‐6 Delta, Tyrihans, Yttergryta and
Volund, the last of which was previously included in the Alvheim figures, to which it is tied back. Notably
Tyrihans shows a much more rapid ramp‐up than previously assumed. Elsewhere, the Snohvit LNG plant,
shut down for maintenance since mid‐August, eventually resumed operations in mid‐November, after
some start‐up problems earlier in the month. Norway’s NGL forecast was raised by around 50 kb/d in
2010‐2014. Total oil production in 2009 and 2010 is now forecast at 2.3 mb/d and 2.1 mb/d respectively.

mb/d Norway Total Oil Supply mb/d UK Total Oil Supply
2.80 2.00
2.60 1.80
2.40 1.60
2.20 1.40
2.00 1.20
1.80 1.00
2007 2008 2007 2008

UK – September actual: September oil production in the UK was revised down by 60 kb/d on lower‐
than‐expected crude output, which was then carried through the forecast. Disaggregated August field‐
by‐field data confirmed the extent and details of this summer’s heavier‐than‐usual field maintenance,
which saw total UK liquids output dip to below 1.1 mb/d, its lowest since 1978. August data also showed
the first reported production at the Affleck, Ettrick and Shelley fields, which will collectively add around
40 kb/d of crude. Total UK oil production is forecast to average 1.5 mb/d in 2009 and to decline to
1.3 mb/d in 2010.

Former Soviet Union (FSU)
Russia – October actual, November provisional: Revisions to preliminary October production data for
Russia showed crude output 25 kb/d higher than expected, most of which stemmed from higher production
from smaller producers. Preliminary November oil production data showed output flat compared with
October, with an increase from Rosneft’s new Vankor field offsetting small declines from other companies.

mb/d Russia Crude Oil Supply mb/d Russia NGL Supply
10.00 0.65
9.90 0.60
9.80
0.55
9.70
0.50
9.60
9.50 0.45
9.40 0.40
2007 2008 2007 2008

The Russian government has confirmed that a group of 19 oil fields in Eastern Siberia will benefit from an
exemption to crude export duties from 1 December 2009. However, there still remains some uncertainty
as to how long the exemption will last. It is generally held that a minimum of five years is necessary to
break even on capital‐intensive greenfield projects in what is still an undeveloped province. The start‐up

of production at the new Talakanskoye, Verkhnechonskoye and the huge Vankor fields in the past year is
one of the main reasons Russian production has picked up – and expectations of tax breaks were central
to this development. However, considerable uncertainty stems from the fact that the export duty waiver
will still have to be renewed each month. Total 2009 oil production in Russia is revised up 60 kb/d to
10.2 mb/d, while 2010 output is nudged up by 140 kb/d to 10.4 mb/d.

mb/d Kazakhstan Total Oil Supply mb/d Azerbaijan Total Oil Supply
1.70 1.50
1.30
1.60
1.10
1.50
0.90
1.40
0.70
1.30 0.50
2007 2008 2007 2008

Other FSU: Kazakhstan’s NGL baseline is revised up by 45 kb/d for 2009. In addition, October crude
production data were around 100 kb/d higher than anticipated, with the large Tengiz field picking up to
over 500 kb/d again, only the second time it has breached that level, following some capacity expansion
work this summer. The Karachaganak field meanwhile also came in slightly higher than expected,
following maintenance in September. Total 2009 production is forecast to average 1.6 mb/d and is set to
remain broadly flat in 2010. In Azerbaijan and Uzbekistan, NGL baselines were revised downward and
upwards by around 5 kb/d and 10 kb/d respectively – both historically and in the forecast.

FSU Net Exports of Crude & Petroleum Products
Latest month vs.
2007 2008 3Q2008 4Q2008 1Q2009 2Q2009 Aug 09 Sep 09 Oct 09
Sep 09 Oct 08
Crude
Black Sea 2.18 2.05 1.97 2.04 2.30 2.23 2.07 2.18 2.12 -0.06 0.03
Baltic 1.59 1.46 1.40 1.47 1.57 1.66 1.67 1.61 1.69 0.08 0.37
Arctic/FarEast 0.32 0.30 0.29 0.37 0.46 0.45 0.47 0.54 0.50 -0.04 0.10
BTC 0.55 0.67 0.64 0.57 0.74 0.80 0.81 0.79 0.85 0.06 0.46
Crude Seaborne 4.63 4.48 4.30 4.45 5.07 5.14 5.01 5.12 5.16 0.04 0.96
Druzhba Pipeline 1.13 1.08 1.03 1.09 1.14 1.12 1.07 1.13 1.15 0.02 0.06
Other Routes 0.44 0.42 0.46 0.40 0.40 0.40 0.30 0.38 0.33 -0.05 -0.15
Total Crude Exports 6.20 5.98 5.79 5.94 6.61 6.66 6.38 6.63 6.64 0.01 0.87
Of Which: Transneft 4.27 3.99 3.87 3.96 4.22 4.27 4.15 4.24 4.21 -0.03 0.19
Products
Fuel oil 1.10 1.09 1.04 1.04 0.96 1.16 1.10 1.16 0.98 -0.19 -0.04
Gasoil 0.95 0.94 0.79 0.92 1.10 0.95 0.95 0.88 0.87 -0.01 0.04
Other Products 0.60 0.59 0.55 0.56 0.73 0.79 0.63 0.57 0.56 -0.01 0.01
Total Product 2.65 2.63 2.38 2.52 2.78 2.89 2.67 2.61 2.40 -0.21 0.00
Total Exports 8.85 8.61 8.17 8.46 9.39 9.55 9.05 9.24 9.04 -0.20 0.87
Imports 0.04 0.04 0.05 0.03 0.04 0.05 0.04 0.04 0.04 0.00 0.00
Net Exports 8.82 8.57 8.12 8.43 9.35 9.50 9.01 9.21 9.00 -0.20 0.87
Sources: Petro-Logistics, IEA estimates
Note: Transneft data has been revised to exclude Russian CPC volumes.

FSU net exports fell by 2.2% to 9.0 mb/d in October on a 7.9% drop in products exports caused mainly by
a decrease in fuel oil shipments. Crude oil exports remained almost unchanged at 6.6 mb/d in October
as a drop in the Black Sea and Arctic shipments balanced higher loadings from the Baltic and the BTC.
The Ukrainian port of Pivdenne has accommodated oil usually shipped by pipeline to Novorossiysk and
Odessa. These ports saw deliveries cut due to maintenance and line reversal, respectively.


Russian loading schedules for November and December do not show any exports from Odessa, nor any
deliveries of Russian crude oil to China via the Atasu‐Alashankou line, after all three sections of the
Kazakhstan‐China oil pipeline were connected. The Kozmino terminal on Russia’s Pacific Coast appeared
as a new export outlet in December’s loading schedule. The end‐point of the ESPO pipeline is scheduled
to load its first 100,000 mt tanker with Rosneft crude oil delivered to the port by rail.

According to preliminary data, Russian crude oil exports dropped in November on lower Baltic and Arctic
shipments, as well as lower BTC volumes. December shipments are expected to rise month‐on‐month,
supported by higher volumes scheduled for export from Baltic ports and via the BTC, despite a 17%
increase in Russian crude oil export duties from 1 December to $271.1/mt ($37.0/bbl). Export duties for
light and heavy oil products are set at $194.9/mt and $105.0/mt, respectively.

Other Non-OPEC
China – October actual: Chinese oil production in October was revised down by 135 kb/d to 3.8 mb/d on
lower‐than‐expected production offshore and, to a lesser degree, elsewhere. In mid‐November, strong
winds shut‐in offshore production in Bohai Bay, but it is unclear by how much and for how long (this
report adjusted by ‐25 kb/d). Total Chinese oil production in 2009 and 2010 was revised down slightly
and is now forecast to average 3.8 mb/d and 4 mb/d respectively.

mb/d Brazil Total Oil Supply mb/d Colombia Total Oil Supply
2.80 0.80
2.70 0.75
2.60
0.70
2.50
0.65
2.40
0.60
2.30
2.20 0.55
2.10 0.50
2007 2008 2007 2008

Various Latin America: In Brazil, total oil production in October was revised up by 30 kb/d, as higher‐
than‐expected crude and NGL output offset slightly lower fuel ethanol supply. A review of project
start‐up dates indicated some slippage in 2010‐2012, and therefore downward revisions, though these
projects then simply lead to upward adjustments in 2013 and 2014. Total 2009 oil production is set to
rise from 2.5 mb/d in 2009 to 2.7 mb/d in 2010. In Peru, the NGL review has prompted the reallocation
of some crude production into the NGL category, related to the Camisea gas project. Forecast
production in 2009 and 2010 is kept steady at 150 kb/d. In Colombia, steady gains at the Rubiales heavy
crude field and anticipated future projects, incentivised by a welcoming upstream investment
environment, have prompted small revisions to the near term (around +15 kb/d for 2009/10) and a
greater upward adjustment for the medium‐term forecast (around +170 kb/d on average for 2011‐2014).
Total 2009 oil production is expected to average 670 kb/d and rise to 740 kb/d in 2010.

Various Africa and Middle East: For Egypt, the NGL review resulted in an upward revision by around
25 kb/d of historical estimates and a slightly higher forecast profile. Crude production figures were left
unchanged this month. Total Egyptian oil production is forecast to decline from 660 kb/d in 2009 to
620 kb/d in 2010. In Tunisia, the NGL and crude forecasts were trimmed by a collective 12 kb/d in 2009
and marginally curbed for 2010‐2014. In Oman, the NGL baseline was also nudged down somewhat. In
the medium‐term outlook however, Oman’s crude profile has been raised substantially as several
Enhanced Oil Recovery (EOR) projects boost production. Total 2009 oil production is forecast to average
800 kb/d, rising to 860 kb/d in 2010.

OECD S TOCKS I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT
OECD STOCKS

Summary
• OECD industry stocks fell counter‐seasonally by 36.0 mb in October to 2,735 mb. The five‐year
average stock change for October is a 3.9 mb build. Over 40% of the draw came in middle distillates
as holdings in all three regions declined. Crude stocks fell 0.9 mb, led by a 6.8 mb draw in Europe,
countered by a 4.9 mb build in Pacific inventories. North American ‘other products’ and gasoline
stock draws also drove the overall change.
• OECD stocks in days of forward demand fell to 59.4 days as of end‐October, down from 60.2 days at
end‐September. Days cover fell most in residual fuel oil and middle distillates, with declines evident
in all three regions. Nonetheless, distillate days cover remains well above the five‐year range in North
America and Europe and just above the five‐year average in the Pacific.
• Preliminary data indicate total OECD industry oil inventories edged up by 0.4 mb in November, with
crude rising 6.6 mb and products falling 6.2 mb. The five‐year average stock change in November is a
draw of 4.0 mb. Middle distillate stocks drew 3.1 mb with US jet fuel/kerosene falling 3.0 mb.
• Short‐term crude floating storage levels declined to 55 mb as of end‐November, from 61 mb at end‐
October. Market reports continue to vary, with one estimate putting short‐term storage below
35 mb. However, recent widening contango in the crude futures curve may signal increasing
December storage volumes. Short‐term products floating storage continued to rise, increasing to
98 mb at end‐November from 83 mb at end‐October, with most of the build occurring off Europe.

OECD Crude Oil Stocks OECD Middle Distillate Stocks

mb days
Days of Forward Demand
1,065
40
1,015
965 35
915
30
865
815 25
Range 2004-2008 2008 Range 2004-2008 2008
2009 Avg 2004-2008 2009 Avg 2004-2008

OECD Stock Position at End-October and Revisions to Preliminary Data
OECD commercial inventories dropped by 36.0 mb in October to 2,735 mb. The downward move was
the largest OECD monthly stock draw since February 2008 and marked only the second time OECD
inventories have decreased over the past twelve months. By comparison, the five‐year average stock
movement for October is a 3.9 mb build. Significantly, over 40% of the overall draw came in middle
Preliminary Industry Stock Change in October 2009 and Third Quarter 2009
October (preliminary) Third Quarter 2009
(million barrels) (million barrels per day) (million barrels per day)
N. Am Europe Pacific Total N. Am Europe Pacific Total N. Am Europe Pacific Total
Crude Oil 0.9 -6.8 4.9 -0.9 0.03 -0.22 0.16 -0.03 -0.26 -0.15 -0.05 -0.45
Gasoline -5.2 -0.4 -0.1 -5.7 -0.17 -0.01 0.00 -0.18 -0.03 0.02 -0.01 -0.02
Middle Distillates -6.3 -5.8 -3.4 -15.5 -0.20 -0.19 -0.11 -0.50 0.16 0.08 0.11 0.35
Residual Fuel Oil -0.3 -1.9 0.2 -2.0 -0.01 -0.06 0.01 -0.07 -0.01 -0.09 0.03 -0.07
Other Products -10.2 -1.0 0.6 -10.7 -0.33 -0.03 0.02 -0.34 0.07 0.06 0.10 0.23
Total Products -22.0 -9.1 -2.7 -33.8 -0.71 -0.29 -0.09 -1.09 0.19 0.07 0.22 0.48
1
Other Oils 1.4 0.0 -2.7 -1.3 0.05 0.00 -0.09 -0.04 0.06 0.01 0.02 0.08
Total Oil -19.6 -15.8 -0.5 -36.0 -0.63 -0.51 -0.02 -1.16 -0.01 -0.07 0.20 0.11
1 Other oils includes NGLs, feedstocks and other hydrocarbons.

I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT OECD S TOCKS
distillates as all three regions posted declines. The OECD distillate surplus to the five‐year average –
concentrated in Europe and North America – narrowed to 66 mb. Yet, with products floating storage
rising 14 mb in Europe and preliminary data pointing to only a 3.1 mb onshore middle distillate stock
draw during November, it is too soon infer any sustained draining of surpluses in that product category.
Moreover, days of distillate forward demand cover, though only near five‐year average levels in the
Pacific, remain well above the five‐year range in North America and Europe.

days OECD Pacific Mid Distillate Stocks mb OECD North America mb

Days of Forward Demand Crude Oil Stocks
560 80
35
510 60
30
40
460
25 20
410 0
20
360 -20
15
Oct 07 Apr 08 Oct 08 Apr 09 Oct 09
Range 2004-2008 2008 Diff to 5-Year Average (rhs)
2009 Avg 2004-2008 OECD North America Crude Stocks

OECD crude stocks continued to come more into balance with historical norms. Despite only drawing by
0.9 mb in October, downward revisions to September holdings in North America and Europe narrowed
the OECD crude surplus versus the five‐year average to 15 mb, the smallest since August 2008.
Preliminary November data point to a fall in short‐term floating storage, but a rise in onshore stocks.
Moreover, a recent widening of the contango in NYMEX light, sweet crude combined with dismal
refinery runs in the US have made onshore and offshore crude storage more attractive. Year‐end tax
considerations in the US may prompt some destocking before January, but without a sustained boost in
refinery demand, crude inventories look to remain healthy in the near term.

Revisions versus 12 November 2009 Oil Market Report
(million barrels)
North America Europe Pacific OECD
Aug 09 Sep 09 Aug 09 Sep 09 Aug 09 Sep 09 Aug 09 Sep 09
Crude Oil -3.5 -6.7 -3.2 -8.7 0.1 7.8 -6.7 -7.7
Gasoline 0.0 -1.9 1.5 1.9 0.0 -0.1 1.5 -0.1
Middle Distillates 1.0 0.4 0.0 -1.8 0.0 -0.6 1.0 -2.0
Residual Fuel Oil -0.3 1.2 -1.0 0.7 0.0 0.0 -1.3 1.9
Other Products 1.2 0.2 -0.4 0.8 0.0 0.8 0.8 1.7
Total Products 1.9 -0.1 0.1 1.6 0.0 0.0 1.9 1.5
Other Oils1 -0.4 5.0 -0.1 -2.2 0.0 -0.2 -0.5 2.5
Total Oil -2.0 -1.9 -3.3 -9.4 0.1 7.6 -5.2 -3.7
1 Other oils includes NGLs, feedstocks and other hydrocarbons.

Analysis of Recent OECD Industry Stock Changes
OECD North America
North American industry stocks fell 19.6 mb in October, entirely focused on oil products and driven by a
4.9 mb fall in US distillates and a 4.6 mb fall in US gasoline. US ‘other products’ ‐ a volatile category that
includes naphtha, liquefied petroleum gases, petroleum coke, white spirits, lubricants, bitumen and
others ‐ fell 10.4 mb. A 2.4 mb draw in Mexican products was led by distillate and residual fuel oil.
Crude changed little overall, with a 1.8 mb gain in Mexico partially offset by a 0.9 mb fall in the US.
North American government crude holdings remained unchanged.


November preliminary data point to a 0.6 mb draw in total US commercial stocks. Crude stocks increased
by 2.1 mb and inventories at Cushing, Oklahoma – the delivery point for the NYMEX light, sweet crude
contract – swelled by 6.2 mb, including a 2.5 mb increase in the most recent week. Deepening contango
in WTI has both resulted from and contributed to the Cushing builds. Strategic Petroleum Reserve (SPR)
holdings rose by 1.0 mb in November and are expected to increase a further 0.5 mb in December.
mb US Weekly Industry Crude Oil mb US Weekly Cushing Crude Stocks

Stocks 40
390
370 35
350 30
330 25
310
20
290
15
270
Source: EIA
250 10 Source: EIA
Jan Apr Jul Oct Jan Apr Jul Oct
Range 2004-08 5-yr Average Range 2004-08 5-yr Average
2008 2009 2008 2009

US product stocks fell by 2.7 mb in November, driven by a decrease in propane of 7.3 mb and in jet
fuel/kerosene of 3.0 mb. The latter category came back into the five‐year range for the first time since
June. Distillate stocks drew by 1.0 mb. Yet diesel accounted for the entire draw. Heating oil stocks
continued to trend above the five‐year average, particularly along the US East Coast and Northeast,
where most home oil‐fired heating is concentrated.

mb US Weekly Jet/Kerosene Stocks mb US Weekly PADD 1 Heating Oil
50 Stocks
50
45 40
40 30
35 20
Source: EIA Source: EIA
30 10
2008 2009 2008 2009

OECD Europe
European inventories fell by 15.8 mb in October, mostly due to a 6.8 mb decrease in crude and a 5.8 mb
draw in middle distillate inventories. European crude stocks fell to the bottom of the five‐year range on
an absolute basis, but remained at the top of the five‐year range on a days cover basis.

The draw in middle distillates was slightly larger than the five‐year average draw of 5.1 mb, and came as
October products floating storage – mostly middle distillates – off Northwest Europe and the
Mediterranean decreased by almost 3 mb (albeit, levels rose again in November). German consumer
heating oil stock levels remained unchanged at 68% at end‐October, but dropped to 65% at end‐
November. Still, the October OECD Europe middle distillate stock surplus to the five‐year average
remained high, at 34.9 mb, relative to its 2009 peak of 43.3 mb in May.

OECD Europe Crude Oil Stocks days OECD Europe Crude Oil Stocks
mb Days of Forward Demand
360 26
350 25
340 24
330 23
320 22
310 21
300 20
Range 2004-2008 2008 Range 2004-2008 2008
2009 Avg 2004-2008 2009 Avg 2004-2008

November preliminary data show gasoil stocks held in NW Europe independent storage remained
relatively constant through the month and well above the five‐year range. Naphtha, jet‐kerosene,
residual fuel oil and gasoline all posted increases on the month with the latter three categories all
trending above the five‐year range. Products floating storage off Northwest Europe and in the
Mediterranean increased by over 14 mb, accounting for most of the global change in November. EU‐16
preliminary data from Euroilstock also showed middle distillate stocks increasing, by 0.2 mb in
November. Fuel oil and naphtha posted gains of 0.8 mb and 0.4 mb, respectively, while gasoline fell
0.8 mb. Crude stocks showed larger movement, however, increasing 8.0 mb.

German End User HO Stocks
mb OECD Europe mb
%
% of Storage Capacity
Middle Distillate Stocks 70
320 50
300 40 65
30
280 60
20
260 10 55
240 0 50
-10
220 -20 45
200 -30 40
Oct 07 Apr 08 Oct 08 Apr 09 Oct 09 Jan Mar May Jul Sep Nov Jan
Difference to 5-Year Average (rhs) Range 2004-2008 2008
OECD Europe Middle Distillate Stocks 2009 Avg 2004-2008

OECD Pacific
Pacific industry stocks fell by 0.5 mb in October, as a 4.9 mb crude build was offset by a 3.4 mb decrease
in middle distillates and a fall in ‘other oils’. The Pacific middle distillate deficit to the five‐year average
fell to 10 mb. Japanese crude stocks gained 5.5 mb, while Korean crude holdings decreased 0.6 mb. On
an absolute basis, Japanese crude inventories have trended below the five‐year range while Korean
holdings are at five‐year highs. Yet, on a days of forward cover basis, crude inventories for both
countries remained above the five‐year average, near the top of the five‐year range.
Korea Crude Oil Stocks Japan Crude Oil Stocks
mb mb
40 150
35 140
30
130
25
120
20
15 110
10 100
Range 2004-2008 2008 Range 2004-2008 2008
2009 Avg 2004-2008 2009 Avg 2004-2008

Weekly data from the Petroleum Association of Japan (PAJ) point to a commercial stock draw of 7.7 mb
in November, with crude falling 3.6 mb and products falling 4.1 mb. Naphtha stocks decreased 2.2 mb
while kerosene stocks increased 1.0 mb. Kerosene stocks continued to trend below the five‐year range
as refinery throughputs have languished. Still, inventory levels have thus far not drawn steeply in
comparison to previous winters. As such, stocks have slightly narrowed their deficit to the five‐year
average in recent weeks.

mb Japan Weekly Onshore Crude mb Japan Weekly Kerosene Stocks
Stocks 40
150
35
140
30
130
25
120
20
110
100 15
90 10
Source: PAJ
80 5 Source: PAJ
2008 2009 2008 2009

Recent Developments in Singapore Stocks
Singapore product stocks increased by 3.8 mb in November. Fuel oil stocks rose by 4.0 mb to new five‐
year highs as increasing supplies from Europe outweighed strong regional demand. Light distillate stocks
edged up on the month and remained above the five‐year range. Despite a slight fall in middle
distillates, low export opportunities and high levels of regional floating storage kept stocks in the
category also above the five‐year range.

m b Singapore Weekly Residue Stocks Singapore Weekly Middle Distillate
25 mb
Stocks
16
20 14
12
15
10
8
10
6
Source: Int ernational Enterprise Source: Int ernational Ent erprise
5 4
2008 2009 2008 2009


Regional OECD End-of-Month Industry Stocks

(in days of forward demand and millions barrels of total oil)
Days1 Million Barrels
Days mb North America
North America
64 1,450
1,400
59 1,350
1,300
54 1,250
1,200
49 1,150
1,100
44 1,050
Range 2004-2008 2008 Range 2004-2008 2008
2009 Avg 2004-2008 2009 Avg 2004-2008
Days Europe mb Europe

72 1,020
70 1,000
68 980
66
960
64
62 940
60 920
58 900
56 880
Range 2004-2008 2008 Range 2004-2008 2008
2009 Avg 2004-2008 2009 Avg 2004-2008
Days Pacific mb Pacific

60 480
460
55
440
50
420
45
400
40 380
Range 2004-2008 2008 Range 2004-2008 2008
2009 Avg 2004-2008 2009 Avg 2004-2008
Days OECD Total Oil mb OECD Total Oil

63 2,800
61 2,750
2,700
59
2,650
57
2,600
55 2,550
53 2,500
51 2,450
49 2,400
Range 2004-2008 2008 Range 2004-2008 2008
2009 Avg 2004-2008 2009 Avg 2004-2008
1 Days of forward demand are based on average demand over the next three months

P RICES I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT
PRICES

Summary
• Crude oil futures prices traded in a higher $75‐80/bbl range in November, with WTI averaging
$78.15/bbl and Brent $77.58/bbl for the month. By early December, however, prices weakened on
market fears that the recovery in the global economy will be shallower and slower than expected,
especially in the key US market. Prices were trading at eight‐week lows of around a $70‐74/bbl range
at the time of writing.
• The oil price correlation with macro financial market activity that has marked most of 2009 has
arguably started to weaken as supply and demand fundamentals appear to reassert more control
over price direction. Global oil demand growth, led largely by China, appears to be putting a floor under
price expectations for the medium and long term. The NYMEX WTI crude oil futures forward curve
reached the $100/bbl mark for the 2016 contract. However, despite significant idled refining capacity, a
persistent high level of distillate stocks continues to temper near‐term price moves to the upside.
• Spot product prices were higher across the board in November, with naphtha in Asia posting the
sharpest increases. Gas oil markets posted more modest gains on relatively weak demand and high
stock levels. Refining margins were universally weaker in November as product price gains trailed
higher crude oil prices. Losses on the US Gulf Coast generally outpaced other regions.
• Freight rates firmed in November and posted further gains in early December. Crude tanker rates in
particular improved amid increased volatility caused by both adverse weather conditions and the
impact of holidays on chartering activity.
$/bbl Benchmark Crude Prices $/bbl NYMEX WTI

Forward Curve
80 105
100
70 95
60 90
85
50 80
Source: Plat ts 75
40 70 Source: Platts
65
30
2010 2011 2012 2013 2014 2015 2016
Jan 09 Mar 09 May 09 Jul 09 Sep 09 Nov 09
09-Oct-09 09-Nov-09
WTI Cushing Dated Brent Dubai 03-Dec-09 09-Dec-09

Market Overview
Crude oil futures prices in November traded in a higher $75‐80/bbl range, with WTI averaging $78.15/bbl
and Brent $77.58/bbl for the month. By early December, however, prices reversed course amid fears
that the global economic recovery, especially in the US and Europe, will be shallower and slower than
expected. Prices were hovering at eight‐week lows at the time of writing, with WTI last trading at
around $70.50/bbl and Brent at $72/bbl.

North Sea Brent prices have far outpaced the rise in West Texas Intermediate, given the latter’s
steepening discount for prompt barrels amid high stock levels and reduced refiner buying. Over the
course of the month, WTI crude went from trading at a premium to Brent of around $1.65/bbl to a
discount of more than $2.50/bbl by the first week of December. Deteriorating refining margins in the key
US Gulf Coast region over the last month have forced refiners to sharply curtail refinery operations, with
runs cut to some of the lowest levels in the past decade. By contrast, margins in Europe have been
relatively stronger, propping up Brent prices relative to WTI.

I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT P RICES
The WTI 1M‐2M contango, with the prompt price under pressure from swelling stocks at the pivotal
Cushing, Oklahoma storage hub and forward prices strengthening on expectations for stronger demand
next year, steadily widened over the past month. The contango rose from an average 44 cents/bbl in
October, to 75 cents/bbl in November and to around $2/bbl in early December. The widening contango
not only highlights the current weakness in US markets but also relative strength in other markets.
$/bbl NYMEX WTI $/bbl Crude Futures

Front Month Spreads Front Month Spreads
0.0 4
NYMEX WTI
-0.5 2 Premium
-1.0 0
-1.5 -2
Contango NYMEX WTI
-2.0 -4
Source: Plat ts
Discount
Source: Platts
-2.5 -6
Jul 09 Aug 09 Sep 09 Oct 09 Nov 09 Dec 09 Jul 09 Aug 09 Sep 09 Oct 09 Nov 09 Dec 09
WTI M1-M2 WTI M2-M3 WTI - Brent (Mth1) WTI - Brent (Mth2)
Indeed, a growing East‐West oil market divide between the US (and to a certain extent Europe) and Asia
is becoming more pronounced—mirroring the global economic recovery outlook. Current market
strength is centred on Asia, and especially China and India, where much of next year’s demand growth
will likely take place.
Stimulus packages in China have had the intended consequence of boosting oil product markets,
especially demand for petrochemical feedstocks like naphtha. Latest demand projections show Chinese
apparent demand posted double‐digit growth rates for the second month in a row in October, with all
products bar residual fuel oil posting gains. By contrast, demand in the US remains anaemic; with
sharply lower refinery throughput rates pressuring spot crude prices.
Ample OECD and floating crude and refined products stocks are likely to cap upward price moves in the near
term while stronger forecast global oil demand growth for 2010, led largely by China, appears to be putting a
floor under price levels for the medium term. The NYMEX WTI crude oil futures curve for 2016 contracts
reached the $100/bbl mark in November, reflecting market expectations of higher long‐term prices.

Futures
The oil price correlation with macroeconomic factors and financial market activity that has marked most
of 2009 may be weakening as supply and demand fundamentals reasserted more control over price
direction. Oil prices have largely moved in lock step with financial and equity markets this year as
traders focus on macroeconomic developments for any signs of a potential recovery in oil demand while
the weaker dollar has prompted some investors to hedge their exposure with oil futures. Over the past
month, the link between oil prices and equity markets and the dollar index appears to have frayed.
NYMEX WTI vs Dollar Index '000 NYMEX WTI Mth1

US$/bbl Index $/bbl
Contracts Open Interest
85 74
1,400 130
75 Source: CFTC, Platts
80 1,300 110
76
75 77 1,200 90
78 1,100 70
70
79 1,000 50
Source: ICE, Platts
65 80
900 30
Aug 09 Sep 09 Oct 09 Nov 09 Dec 09
NYMEX WTI Sep 08 Dec 08 Mar 09 Jun 09 Sep 09 Dec 09
US Dollar Index (inversed RHS) Open Interest NYM EX WTI M th1

Positions on NYMEX Light Sweet Crude Oil (WTI) Futures Contracts

Thousand Contracts
End of Week 1 December 2009 Long Short Net Long/Short Δ Net from Prev. Δ Net Vs Last
Week Month
Producers' Positions 148.9 379.1 -230.2 Short Ï 0.3 Ð -15.1
Swap Dealers' Positions 238.4 104.3 134.1 Long Ï 8.9 Ï 35.1
Money Managers' Positions 165.4 41.0 124.5 Long Ï 9.5 Ð -31.2
Others' Positions 73.1 121.2 -48.1 Short Ð -8.6 Ï 3.8
Non-Reportable Positions 95.5 75.8 19.7 Long Ð -10.1 Ï 7.4
Open Interest 1209.8 Ï 27.0 Ï 18.7
Source: CFTC

Open interest in NYMEX WTI futures increased by 18,700 contracts in November. Swap dealers
increased their net long exposure by 35,100 lots while money managers decrease their net long
exposure by 31,200 contracts. Meanwhile, producers increased their net short positions by 15,100
contracts. However, discerning a clear linkage between open interest and prices remains problematic.

Spot Crude Oil Prices
Spot crude oil prices rose across all major regions in November, with benchmark grades up on average by
$2‐5/bbl month‐on‐month. Asia posted the strongest gains on continued strong Chinese buying. By
contrast, the US spot crude market was markedly weaker $/bbl Urals
due to significantly lower refinery run rates, rising stocks at Differentials (NWE / Med) vs Brent
Cushing and by reduced year‐end crude purchases as 0.4
companies try to minimise their tax liability. 0.2
0.0

-0.2
China continued to be the major prop under spot crude
-0.4
markets in November with refiners holding throughput
-0.6
rates at record levels. Chinese refiners continue to -0.8
augment contract supplies with spot purchases of African -1.0
Source: Plat ts
crudes, which have been relatively cheap given increased Sep 09 Oct 09 Nov 09 Dec 09
volumes of Nigerian and Angolan supplies in the market. Urals (NWE) Urals (Med)
Chinese, South Korean and other Asian refiners have
stepped up their buying of naphtha‐rich crudes such as Algeria’s Saharan Blend and Nigeria’s Agbami
given robust crack spreads and strong demand. Asian light grades also firmed on stronger naphtha cracks.
Spot Crude Oil Prices and Differentials
Table Unavailable
Available in the subscription version.
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In Europe, growing volumes of unsold gasoil‐rich Russian Urals for December pressured spot prices in
NW Europe and the Mediterranean. Russian exports for December are slated to rise despite a 17%
increase in crude oil export duties (see Non‐OPEC Supply, FSU Exports).

Spot Product Prices
Spot product prices were higher across the board in November, with naphtha posting the sharpest
increases while gasoil posted more modest gains. However, crack spreads were generally weaker in
November, with the exception of naphtha and fuel oil in New York, as the rise in spot crude oil markets
eclipsed product prices.

Heading into the peak winter demand period, distillate markets remained under pressure from swelling
stockpiles of heating oil and diesel. Record levels of distillate are being held offshore Europe and the US
Gulf Coast. Distillates stored at sea are estimated at 98 mb at end‐November and set to rise further in
December and January based on tanker bookings.

In Europe, the steep gas oil contango on London’s ICE futures exchange is fuelling the stockbuilding
offshore Europe. Since October, the gas oil contango has held steady at between $8‐10/mt compared
with $6‐8/mt in the August‐September period.
$/bbl Gasoil/Heating Oil
ICE Gasoil
$/t Cracks to Benchmark Crudes
Front Month Spreads 30
-4
25
Contango Source: Platts
-6 20
15
-8
10
-10 5
Source: Plat ts 0
-12
Nov 08 Feb 09 May 09 Aug 09 Nov 09
Jul 09 Aug 09 Sep 09 Oct 09 Nov 09 Dec 09
NWE Gasoil 0.1% NYH No. 2
Gasoil M1-M2 Gasoil M1-M3 Med Gasoil 0.1% SP Gasoil 0.5%

Asian naphtha prices and cracks rose to their highest level in more than a year on 1 December in the face
of stronger demand for January supplies. The economics for most naphtha cracking complexes improved
markedly, with plants working full‐out producing olefins to meet stronger demand from China, South
Korea and Japan.

One of Asia's top petrochemicals importers, South Korea,
helped put a floor under naphtha prices in November $/bbl Naphtha
with term deals for 1H10 fetching a premia of around 4
Cracks to Benchmark Crudes
$5/mt to Japanese spot quotes compared with a discount
2
of $12/mt for the full year 2009 term contracts. Naphtha
0
crack spreads in Singapore averaged ‐$1.51/bbl in
-2
November compared with ‐$3.95/bbl in October.
-4

-6
In Europe, naphtha crack spreads turned positive in late Source: Platt s
-8
November on increased export flows to Asia. Rotterdam
Jul 09 Aug 09 Sep 09 Oct 09 Nov 09 Dec 09
naphtha cracks averaged ‐$2.11/bbl for November versus
NWE SP
‐$3.63/bbl the previous month. Mediterranean naphtha Med CIF ME Gulf
cracks averaged ‐$1.83/bbl in November compared with
‐$3.57/bbl in October.


Spot Product Prices
Table Unavailable
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Refining Margins
Refining margins were universally weaker in November as product price gains trailed higher crude oil
prices. Losses on the US Gulf Coast generally outpaced other regions. Upgrading margins stabilised in
the US but remained negative, close to September lows. Deteriorating refining margins in the key US
over the last month have forced refiners to cut runs to just below 80%, a level not seen in a decade if
hurricane‐related low utilisation rates are excluded.
European Upgrading Margins Upgrading Margins

$/bbl $/bbl
(Cracking - Hydroskimming Margin) (Co king - Cracking in the US.
8 Hydro cracking - Hydro skimming in A sia)
5
7 4
6 3
5 2
1
4 0
3 -1
2 -2
Jan 09 Mar 09 May 09 Jul 09 Sep 09 Nov 09 Jan 09 Mar 09 May 09 Jul 09 Sep 09 Nov 09
NWE (Urals) Med (Urals) USGC (Mars) Singapore (Dubai)

With the exception of Urals cracking in NW Europe and Kern processing on the West Coast, margins were
in negative territory. European upgrading margins revisited the lows seen in September and the first –

quarter of 2009. The deterioration in light and middle distillate cracks (with the exception of naphtha)
and stronger fuel oil cracks underpin these moves.

Selected Refining Margins in Major Refining Centres
($/bbl)
Monthly Average Change Average for week ending:

Sep 09 Oct 09 Nov 09 Nov 09-Oct 09 06 Nov 13 Nov 20 Nov 27 Nov 04 Dec
NW Europe Brent (Cracking) 0.66 0.91 -0.11 Ð -1.02 0.49 -0.01 -0.30 -0.61 -0.30
Urals (Cracking) 0.56 0.81 0.31 Ð -0.50 0.47 0.19 0.37 0.21 0.43
Brent (Hydroskimming) -0.80 -0.96 -1.83 Ð -0.87 -1.37 -1.59 -2.03 -2.32 -2.08
Urals (Hydroskimming) -2.69 -3.03 -3.49 Ð -0.46 -3.45 -3.56 -3.41 -3.53 -3.43
Mediterranean Es Sider (Cracking) 0.33 -0.03 -0.86 Ð -0.83 -0.73 -0.74 -0.47 -1.47 -1.01
Urals (Cracking) 0.91 0.83 -0.05 Ð -0.87 0.34 -0.03 0.17 -0.63 -0.12
Es Sider (Hydroskimming) -2.81 -3.78 -4.23 Ð -0.45 -4.41 -3.86 -3.87 -4.69 -4.56
Urals (Hydroskimming) -3.41 -4.12 -4.77 Ð -0.65 -4.44 -4.50 -4.59 -5.47 -5.06
US Gulf Coast Bonny (Cracking) -2.68 -1.66 -4.09 Ð -2.43 -3.61 -4.23 -4.40 -4.27 -4.30
Brent (Cracking) -2.65 -2.06 -4.03 Ð -1.97 -3.53 -4.21 -4.43 -4.12 -4.20
LLS (Cracking) -1.66 -1.60 -2.56 Ð -0.96 -2.97 -3.02 -2.76 -1.42 -2.90
Mars (Cracking) 0.82 -0.09 -1.26 Ð -1.17 -1.31 -1.72 -1.30 -0.67 -1.30
Mars (Coking) -0.21 -0.14 -2.12 Ð -1.98 -2.23 -2.55 -2.16 -1.50 -2.03
Maya (Coking) -2.58 -1.43 -3.23 Ð -1.80 -3.70 -3.66 -3.34 -2.33 -2.14
US West Coast ANS (Cracking) 1.89 -1.86 -3.02 Ð -1.16 -3.92 -3.90 -2.72 -1.94 -1.89
Kern (Cracking) 8.84 3.47 3.06 Ð -0.41 1.83 2.11 3.27 4.65 5.31
Oman (Cracking) 2.22 -1.65 -5.52 Ð -3.87 -5.11 -6.28 -5.54 -5.30 -5.41
Kern (Coking) 14.31 8.00 5.36 Ð -2.64 4.31 3.90 5.73 7.02 6.40
Singapore Dubai (Hydroskimming) -2.13 -4.31 -4.58 Ð -0.27 -4.76 -4.66 -4.64 -4.36 -4.53
Tapis (Hydroskimming) -3.60 -6.07 -6.68 Ð -0.61 -6.37 -6.95 -6.47 -6.94 -6.54
Dubai (Hydrocracking) -1.64 -3.56 -3.67 Ð -0.12 -3.75 -3.82 -3.64 -3.55 -3.64
Tapis (Hydrocracking) -2.69 -4.58 -4.73 Ð -0.15 -4.43 -5.08 -4.46 -4.96 -4.38
China Cabinda (Hydroskimming) -4.82 -8.03 -8.63 Ð -0.60 -8.71 -8.19 -8.77 -8.83 -9.03
Daqing (Hydroskimming) -2.48 -5.83 -7.60 Ð -1.77 -7.27 -7.67 -7.80 -7.67 -8.56
Dubai (Hydroskimming) -2.35 -4.60 -4.95 Ð -0.35 -5.11 -4.98 -5.11 -4.73 -4.95
Daqing (Hydrocracking) 0.17 -2.62 -3.66 Ð -1.04 -3.55 -3.83 -3.71 -3.61 -3.99
Dubai (Hydrocracking) -1.79 -3.82 -4.04 Ð -0.22 -4.09 -4.13 -4.12 -3.91 -3.98
For the purposes of this report, refining margins are calculated for various complexity configurations, each optimised for processing the specific crude in a specific refining centre on a 'full-
cost' basis. Consequently, reported margins should be taken as an indication, or proxy, of changes in profitability for a given refining centre. No attempt is made to model or otherwise
comment upon the relative economics of specific refineries running individual crude slates and producing custom product sales, nor are these calculations intended to infer the marginal
values of crudes for pricing purposes.
*The China refinery margin calculation represents a model based on spot product import/export parity, and does not reflect internal pricing regulations.

End-User Product Prices in November
In November, retail prices on average rose by 6.1%, in End-User Product Prices
US dollars, ex‐tax, and were 17.7% above levels of a Monthly Changes
12%
year ago. Heating oil and low‐sulphur fuel oil prices 5.7% 5.7% 5.4% 7.8%
10%
rose by 5.4% and 7.8%, respectively, across all surveyed
8%
IEA member countries.
6%

4%
Transport fuel prices on average increased by 5.7%
2%
month‐on‐month. US consumers paid $2.65/gallon
0%
($0.70/litre) and in the UK prices averaged £1.09/litre
-2%
($1.80/litre). In mainland Europe, the average gasoline
Gasoline Diesel Heat.Oil LSFO
price at petrol station was between €1.07/litre
France Germ any Italy
($1.60/litre) in Spain and €1.32/litre ($1.96/litre) in Spain United Kingdom Japan
Canada United States AVERAGE
Germany. In contrast, gasoline prices in Japan
decreased by 1.6% and consumers on average paid
¥126.9/litre ($1.42/litre).

Freight
Overall freight rates firmed in November and posted further gains in early December. Crude tanker rates
especially improved, amid much volatility caused by both adverse weather conditions and the impact of
holidays on the chartering activity, with rates typically rising ahead of the holidays and then falling.

Daily Crude Oil Tanker Voyage Daily Product Tanker Voyage Freight
Freight Rates (US$/tonne) Rates (US$/tonne)
20
30
20
10
10
Source: Platts Source: Platts

0 0
Jan/09 Mar/09 May/09 Jul/09 Sep/09 Nov/09 Jan 09 Mar 09 May 09 Jul 09 Sep 09 Nov 09
8 0 k t N S e a - N W E ur 13 0 k t W A f r- US A C 3 0 K C a rib - US A C 2 5 K UKC - US A C
V LC C M E G ulf - J a p 75K M EG-Jap 3 0 K S E A s ia - J a p

On the crude tanker side, rates for VLCC Mideast Gulf‐ Japan started the month on a weakening trend,
but were soon hiked by a chartering rush ahead of the Eid and Thanksgiving holidays, reaching above
$11/tonne, before falling again from 26th November. Early December saw tighter tonnage availability
and a run‐up in chartering activity before Christmas. Suezmax West Africa‐US Atlantic Coast rates posted
their highest levels since January/February at above $17/mt. Aframax North Sea‐NWE rates also hit peak
levels for 2009 at close to $8/mt on 23 November, supported by weather‐related delays in the Turkish
straits and the Caribbean, which caused charterers to seek replacement tankers, and also due to higher
North Sea and Baltic crude supply. After a small dip at month end, rates were rising in early December.

On the product tanker side, Aframax (75kt) Mideast Gulf – Japan rates rose steadily to above $28/mt at
month end, supported by high interest for moving naphtha to the Far East. These routes also received
support from a build‐up in products stored at large
product tankers. Other product tanker benchmark rates mb Global Crude Floating Storage
were all remarkably flat throughout the month at levels (short-term and semi-permanent)
175
below the five‐year range, but recovered in early Source: EA Gibson, SSY
155
December. Generally limited interest for moving and IEA estimates
135
gasoline into the US undermined product tanker rates in
115
the Atlantic basin in November.
95

75
Short‐term floating storage of crude fell to an estimated
55
54 mb, while floating storage of products continued an Jan Mar May Jul Sep Nov
upward trend, increasing to 98 mb as of end‐November. Range 2004-08 2008
The centre of gravity for both crude and product storage 2009 A verage 2004-08
at sea is still North West Europe and Mediterranean, while
the build‐up seen in October in Asia has subsided. Reportedly, 149 tankers were employed for storage,
with a large growth in large product tanker participation during November. Floating storage now
reportedly employs around 7‐8% of both the VLCC and the large product tanker fleet.


I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT R EFINING
REFINING

Summary
• Market conditions for the refining industry appear bleaker than last month, particularly for OECD
countries. November refining margins fell across the board, while upgrading margins stabilised but
remained negative in the US and total product stocks in the OECD reached their highest level in
several years in September. Crude runs in non‐OECD countries have shown an upward trend since
January 2009, with China reaching records levels, pressuring crude runs elsewhere in the region.
However, signs that global demand may be trending higher once again after many months of decline,
provides a glimmer of light on the horizon.
• Global 4Q09 crude throughput is expected to average 72.3 mb/d, 0.6 mb/d lower than forecast in
last month’s report. Underpinning the lower estimate are weaker October preliminary data, weaker
November weekly data for the US and higher maintenance activity in Other Asia and the Middle East.
• Global 1Q10 crude throughput is forecast to average 72.7 mb/d, which represents a quarterly and
yearly increase of 0.5 mb/d and 1.0 mb/d, respectively. 1Q10 OECD crude runs are expected to remain flat
quarter‐on‐quarter at 35.2 mb/d, nonetheless representing a reduction of 1.4 mb/d year‐on‐year, as weak
refining margins continue to weigh on crude runs.
m b/d Global Refining m b/d OECD Total

Crude Throughput Crude Throughput
76 41
75 40
74 39
38
73
37
72
36
71 35
70 34
Range 04-08 Average 04-08
Range 04-08 Average 04-08
2010 est. 2009 actual/ est.
2010 est. 2009 actual/ est.

• September refinery yields increased for naphtha, gasoline and gasoil/diesel at the expense of jet
fuel/kerosene and fuel oil. Total OECD gasoline yield increased in spite of weaker crack spreads and
lower yields in Europe and the Pacific. However, gasoline gross output fell, as crude runs in OECD
countries remain constrained. Gasoil/diesel yields continued around five‐year average levels, despite
high middle distillates stocks. Naphtha yields increased, supported by a spike in crack spreads on the
US Gulf Coast.
• Medium‐term projections for crude distillation capacity growth have increased by 1.1 mb/d to
8.7 mb/d. Despite the weak margin outlook, better than expected progress at several world‐class
export refineries in the Middle East and additional Chinese domestic projects result in upward
revisions to our projections. Conversely, the announced capacity closures in the US and a slew of
other project cancellations drive much of the downward revisions to our projections.

Global Refinery Overview
Market conditions for the refining industry appear bleaker than last month, particularly for OECD countries.
November refining margins fell across the board as product price gains were outpaced by higher crude oil
prices. Upgrading margins stabilised but remained negative in the US and total product stocks in the OECD
reached their highest level in several years in September in spite of OECD refiners reducing crude runs by
1.7 mb/d on average in the first three quarters of 2009 compared with the same period in 2008.
11 December 2009 45

R EFINING I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT
m b/d OECD Total Product Stocks m b/d Twelve Largest Oil Consumers*
1,550 64 Total Y-o-Y Change 0.03
63 0.02
1,500 62 0.01
61 0
1,450 60 -0.01
1,400 59 -0.02
58 -0.03
1,350 57 -0.04
1,300 56 -0.05
55 -0.06
1,250
ec 7
ec 8
9
Fe /07
A /08
ug 8
Fe /08
A /09
ug 9
O / 08
O / 09
Ju /08
Ju /09
A n/0
A n/0
D t/0
D t/0
/0
D /0 7
D /0 8
9
Fe /07
A /08
A /08
Fe /08
A /09
A /09
ct
b
b
O 08
O 09
Ju /08
Ju /09
pr
pr
c
c
/0
O
/
/
ec
ec
ct
ct
ct
b
n
pr
pr
ug
ug
O
* Total Oil Dem and > 1.5
Furthermore, crude runs in non‐OECD countries have increased since January, with China reaching records
levels supported by guaranteed domestic margins and tax incentives on exports. This has resulted in lower
product imports and higher product exports, pressuring crude runs elsewhere in the region.

However, a glimmer of light on the horizon has appeared in the form of product demand. The
year‐on‐year change in product demand in the twelve largest oil consumers, which account for around
70% of global product demand, depicts an upward trend since January, and regained growth in
September for the first time in a year. Unless the economic recovery turns out to be w‐shaped, the low‐
point for global demand could prove to be that of May 2009. That said, the refining industry still faces a
long period of consolidation and restructuring.

Medium-Term Refinery Capacity Growth Projections Bounce
As highlighted in last month’s report, the refining industry appears to be starting to address the structural
issues that are currently undermining its profitability. That structural changes have started to occur provides
some reason to be optimistic for the medium‐term outlook for the industry. However, that does not mean
there will be much relief from weak profitability in the short term, in the face of still growing middle
distillate stocks, rising NGL volumes and tight fuel oil markets.
Nevertheless, a review of industry developments since the publication of the MTOMR in June suggests that
projected global refinery capacity growth is likely to total 8.7 mb/d for the period 2008‐2014. This
represents an upward revision of 1.1 mb/d. Growth remains dominated by China at 2.9 mb/d, Other Asia at
2.1 mb/d and the Middle East at 1.5 mb/d. Upward revisions are also dominated by these regions, following
better than expected progress at several world‐scale export and domestic refining projects. Upward
revisions to projected growth amount to 0.8 mb/d in the Middle East, 0.5 mb/d in China and 0.4 mb/d in
Other Asia. The latter revision is largely driven by higher expectations for Indian capacity growth
mb/d Crude Distillation Capacity mb/d Crude Distillation Forecast

2.0 Additions Revisions
1.2
1.5 0.8
1.0 0.4
0.5 0.0
0.0 -0.4
-0.5 -0.8
2009 2010 2011 2012 2013 2014 2009 2010 2011 2012 2013 2014
OECD China OECD China
Other Asia Middle East Other Asia Middle East
Other Non-OECD Other Non-OECD

46 11 December 2009


Medium-Term Refinery Capacity Growth Projections Bounce (continued)
In contrast, the start of capacity rationalisation in North and Latin America partially offset these increases
when compared with June’s projection. North American growth is halved to just 0.6 mb/d, for 2008‐2014,
as a result of several project cancellations and, more importantly, the closure of Valero’s Delaware and
Sunoco’s Eagle Point refineries. The closure of these two plants reduces regional distillation capacity by
more than 0.3 mb/d. North American growth rests mainly on
Crude Distillation Capacity Additions
the large‐scale expansions of Marathon’s Garyville refinery
(180 kb/d), Motiva’s 325 kb/d Port Arthur expansion and
Other Non- OECD
Pemex’s 150 kb/d Minatitlan expansion. A continuation of OECD 13%
the current weak margin conditions may yet result in further 12%
project cancellations. Refineries continue to strive to balance Middle
East
limited cash flow with ongoing non‐discretionary capex for 17% Other Asia
24%
environmental and product quality improvements against the
desire to expand and upgrade their operations. European
growth is unchanged since last June’s report, although several
key projects are now expected to be completed sooner than China
34%
previously projected, including GALP’s Sines expansion (2011)
and Repsol’s Cartagena refinery expansion (2012).
More generally, our concerns over project delays due to a lack of access to capital markets, or delays
resulting from the retendering of contracts to lower costs seem to have been overdone. Projects such as
Saudi Arabia’s 400 kb/d Jubail refinery and the UAE’s 420 kb/d Ruwais refinery expansion awarded
engineering, procurement, and construction contacts some 9‐15 months ahead of our previous
expectations. Evidently, project sponsors took advantage of slack contracting markets to lock‐in favourable
cost reductions more quickly than we had anticipated. Consequently, we now expect these projects to be
completed within the 2014 timeframe.
The Chinese government’s stimulus programme is seen boosting Chinese capacity expansions over the medium
term by an additional 0.5 mb/d. Higher growth is concentrated among projects in the south‐east of the
country. Progress to date at several Indian refinery construction projects has been better than expected, as
they strive to meet the Indian government’s 2012 deadline for a seven year tax‐break on new‐build refineries.
Consequently, we have brought forward projected completion dates for a number of projects. However, not
all Indian projects are currently expected to be meet the 2012 deadline, and it remains to be seen whether
they will start processing crude while downstream units are still under construction, in order to qualify for the
tax incentive, or whether the completion deadline itself will be pushed back to accommodate the laggards.

Global Refinery Throughput
3Q09 global refinery throughput averaged 73.2 mb/d, 70 kb/d higher than in last month’s report. Data for
September were 0.3 mb/d lower than the preliminary figures, but this was compensated by revisions to
August data, which were raised 0.5 mb/d. Overall, 3Q09 refinery runs were 0.7 mb/d below 3Q08 levels.

More interestingly, 3Q09 throughput was 1.4 mb/d higher Refinery Crude Throughput
m b/d
than the previous quarter, while global product demand 40
increased only by 1.2 mb/d, signalling stronger than 39
required crude runs. Considering NGL and other feedstock, 38
the 3Q over‐hang of product comes into sharper focus. 37
36
Refinery runs in non‐OECD countries have shown an
35
upward trend since January 2009, outperforming those of
34
OECD, which, in spite of higher runs from June to August, Jan Apr Jul Oct Jan Apr Jul Oct Jan
are likely to show continued decline thereafter, potentially 08 09 10
reaching a low of 34.9 mb/d in November 2009. OECD Non-OECD
11 December 2009 47

4Q09 global refinery throughput is forecast to reach 72.3 mb/d, which represents a contraction of 0.6 mb/d
compared with last month’s report. Underpinning the lower estimate are weaker October preliminary
data (‐0.5 mb/d), weaker November weekly data for the US and higher maintenance activity in Other Asia
and the Middle East.
Global Refinery Crude Throughput1
Jul 09 Aug 09 Sep 09 Oct 09 Nov 09 Dec 09 Jan 10 Feb 10 Mar 10
OECD
North America 17.6 17.6 17.5 17.1 16.7 16.9 16.5 16.6 16.6
Europe 12.6 12.4 12.4 12.0 11.8 12.3 12.5 12.2 12.2
Pacific 6.1 6.6 6.3 6.1 6.4 6.4 6.6 6.4 6.2
Total OECD 36.4 36.6 36.2 35.3 34.9 35.5 35.5 35.1 35.0
NON-OECD
FSU 6.1 6.3 6.2 5.8 6.1 6.4 6.4 6.4 6.4
Europe 0.7 0.7 0.7 0.8 0.8 0.8 0.8 0.6 0.8
China 7.8 7.7 8.0 7.8 8.0 8.0 8.0 8.0 8.0
Other Asia 8.2 8.6 8.8 8.4 8.5 8.5 9.0 8.8 8.6
Latin America 5.3 5.5 5.2 5.1 5.2 5.3 5.3 5.3 5.3
Middle East 6.0 6.1 6.0 6.2 6.2 6.1 5.8 6.3 6.1
Africa 2.2 2.3 2.3 2.3 2.3 2.3 2.3 2.2 2.4
Total Non-OECD 36.3 37.1 37.2 36.5 37.1 37.3 37.5 37.5 37.5
Total 72.6 73.7 73.4 71.8 72.1 72.9 73.1 72.7 72.4

1 Crude runs in italics are estimates. Forecast crude throughput is based on current IEA demand forecasts.

We have rolled over our forecast to cover 1Q10 and assumed weak refining margins will continue to weigh on
crude runs, particularly for OECD countries. 1Q10 global crude runs are estimated at 72.7 mb/d on average,
which represents a quarterly and yearly increase of 0.5 mb/d and 1.0 mb/d, respectively. 1Q10 OECD crude
runs are expected to remain the same quarter‐on‐quarter to 35.2 mb/d, but remain 1.4 mb/d below 1Q09. In
North America, seasonal maintenance work, mainly in the US, will reduce crude runs to an average of
16.6 mb/d, representing a quarterly decrease of 0.3 mb/d and a 0.6 mb/d decrease year‐on‐year. The
non‐OECD sees crude runs at 37.5 mb/d, which represents a 0.5 mb/d increase on a quarterly basis and an
increase of 2.4 mb/d year‐on‐year, driven by growth from China and India of 1.5 mb/d and
0.4 mb/d respectively.

OECD Refinery Throughput
OECD crude throughput estimates for 4Q09 have been revised down by 0.1 mb/d to 35.2 mb/d as
weaker November data offset higher than expected preliminary data for October. This new estimate for
4Q09 represents a quarter‐on‐quarter decrease of 1.1 mb/d and a 2.2 mb/d contraction year‐on‐year.

OECD October utilisation rates decreased two percentage points month‐on‐month to 78%, representing
a 4.7 percentage point decrease year‐on‐year. European utilisation rates shrunk the most on an annual
basis, losing more than eight percentage points, while utilisation rates in the Pacific and North America
show a decrease of around four and two percentage points, respectively.

North American October crude throughput turned out 0.1 mb/d higher than expected at 17.0 mb/d.
Higher runs in Canada and Mexico offset lower‐than‐expected runs in the US. However, this level
represents a decrease of 0.4 mb/d year‐on‐year and a fall of 0.4 mb/d on a monthly basis, the latter
mainly due to higher maintenance.

48 11 December 2009

Refinery Crude Throughput and Utilisation in OECD Countries

Change from Utilisation rate1
May 09 Jun 09 Jul 09 Aug 09 Sep 09 Oct 09 Sep 09 Oct 08 Oct 09 Oct 08
OECD North America

US2 14.46 14.84 14.63 14.57 14.68 14.09 -0.60 -0.47 79.70 82.63
Canada 1.65 1.73 1.75 1.74 1.54 1.71 0.18 0.02 84.94 83.76
Mexico 1.23 1.14 1.21 1.27 1.25 1.29 0.04 0.09 83.63 71.96
Total 17.34 17.72 17.60 17.58 17.47 17.09 -0.38 -0.36 80.49 82.40
OECD Europe
France 1.66 1.57 1.56 1.45 1.40 1.36 -0.04 -0.47 69.48 93.70
Germany 2.06 2.13 2.12 2.12 2.05 1.99 -0.06 -0.28 82.16 93.72
Italy 1.58 1.59 1.71 1.70 1.65 1.64 -0.01 -0.08 70.10 73.31
Netherlands 1.01 0.84 0.89 0.94 1.08 0.95 -0.13 0.14 78.14 66.79
Spain 1.01 0.97 1.06 1.01 1.02 1.01 -0.01 -0.16 79.11 91.55
UK 1.35 1.45 1.50 1.46 1.52 1.38 -0.14 -0.18 73.15 82.61
Other OECD Europe 3.77 3.73 3.82 3.73 3.64 3.71 0.07 -0.32 78.99 85.88
Total 12.43 12.28 12.64 12.41 12.36 12.02 -0.34 -1.35 76.22 84.79
OECD Pacific
Japan 3.20 2.99 3.17 3.53 3.45 3.15 -0.29 -0.29 67.38 73.52
Korea 2.08 2.28 2.26 2.34 2.25 2.33 0.08 -0.07 85.21 87.79
Other OECD Pacific 0.70 0.69 0.69 0.71 0.64 0.66 0.02 0.00 81.38 81.21
Total 5.98 5.97 6.12 6.58 6.34 6.14 -0.20 -0.36 74.69 79.02
OECD Total 35.76 35.96 36.35 36.56 36.17 35.25 -0.92 -2.06 77.94 82.62
1 Expressed as a percentage, based on crude throughput and current operable refining capacity
2 US50

November US weekly data fell 0.6 mb/d short of expectations to an estimate of 13.9 mb/d. Utilisation
rates fell just below 80%, a level not seen in at least 10 years if we exclude hurricane‐related low points.
We expect US utilisation rates to remain below 80% in December and through 1Q10 and have modified
our forecast accordingly. The Atlantic hurricane season ended as the least active in a decade, with only
two tropical storms ‐ Claudette and Ida ‐ making landfall in the US. Tropical Storm Ida hit land in
Alabama on November 10 with no impact on refineries. The light season stemmed in part from El Niño’s
development last summer.

US Weekly Refinery Utilisation Japan Weekly Refinery Utilisation

100% 100%
95% 95%
90% 90%
85% 85%
80%
80%
75%
75%
70%
70% 65%
Source: EIA Source: PAJ
65% 60%
Range 2004-08 5-yr Average R a nge 2 0 0 4 - 0 8 5 - yr A v e ra ge
2008 2009 2008 2009

11 December 2009 49

OECD North America OECD Europe

m b/d m b/d
20.0 14.5
19.0 14.0
18.0 13.5
17.0 13.0
16.0 12.5
15.0 12.0
Range 2004-2008 Avg 2004-2008 Range 2004-2008 Avg 2004-2008
2008 2009 actual 2008 2009 actual

European crude runs matched our expectations at 12.0 mb/d in October, 0.3 mb/d lower
month‐on‐month and 1.4 mb/d lower year‐on‐year. 4Q09 runs are forecast at 12.0 mb/d, which
represents a drop of 0.4 mb/d quarter‐on‐quarter and a drop of 1.2 mb/d year‐on‐year. We keep last
month’s forecast unchanged. Utilisation rates remain particularly weak in France and Italy.
OECD Pacific October crude runs were in line with

OECD Pacific
expectations at 6.1 mb/d. Lower Korean runs were m b/d
Crude Throughput
offset by slightly higher runs elsewhere in this region. 8.0
However, we have reversed last month’s downward 7.5
adjustment for 4Q09 (‐0.2 mb/d) as November Japanese 7.0
weekly data point to crude runs 0.3 mb/d higher than 6.5
expected. However, increased runs in China and other
6.0
non‐OECD countries in Asia will weigh on OECD Pacific
utilisation rates. As such, 4Q09 crude runs are now 5.5
expected to average 6.3 mb/d, on par with 3Q09 levels, Range 2004-2008 Avg 2004-2008
but 0.4 mb/d below 4Q08. 2008 2009 actual

Non-OECD Refinery Throughput
Non‐OECD crude throughput estimates for 4Q09 have been revised down by 0.5 mb/d to 37.0 mb/d as
October refinery runs were 0.7 mb/d below our projections, mainly the result of lower‐than‐expected
crude runs in Russia and China and higher maintenance activity in Latin America. Nonetheless, this new
estimate for 4Q09 represents a quarter‐on‐quarter and year‐on‐year increase of 0.2 mb/d and 1.8 mb/d,
respectively. On a quarterly basis, 3Q09 was also the first time non‐OECD crude throughput came in
higher than that in OECD countries.
Chinese October crude runs were 7.8 mb/d, 0.2 mb/d below September’s record level and 0.2 mb/d
below our estimate. The October throughput level represents a year‐on‐year increase of 12%. China’s
Fujian facility, the country’s first integrated refining and petrochemical complex with foreign
participation, was reportedly completed and at full operation as of 11 November. Reportedly, more than
$4.5 billion was invested in the complex, with refining capacity tripled to 240 kb/d. The complex also
features a 250 megawatt cogeneration facility which should result in lower operating costs and reduced
greenhouse gas emissions. The complex had been in ramp‐up mode for several months, with October
crude runs reported at 219 kb/d. Additionally, refining capacity at Petrochina’s Golmud plant in
north‐western Qinghai province is reported to have been increased to 30 kb/d as a catalytic cracker unit
started operations at the end of November.
As a result of higher throughput rates, China’s fuel exports are reported up 38% in the first 10 months of
the year, while imports are 6.6% lower, pressuring crude runs elsewhere in the region. China’s vehicle sales
continue to soar, up 73% in October year‐on‐year, in spite of the government’s decision to increase pump
prices for gasoline and diesel, by about 7%, as well as jet fuel prices during the second week of November.
50 11 December 2009

This assures domestic profits to refiners, and on the export side, the Chinese government offers tax
incentives, thus Chinese refiners have every incentive to maximise crude runs. However, we think that
incremental exports may temper any further tax incentives, eventually weighing on crude runs. We are
keeping last month’s 8.0 mb/d throughput projection for 4Q09, albeit upward potential exists.
mb/d China mb/d Russia

8.5 5.0
8.0
7.5
7.0 4.5
6.5
6.0 4.0
5.5
5.0
4.5 3.5
Range 2004-08 2009 Range 2004-08 2009
5 Year Average 2008 5 Year Average 2008

Russian crude runs averaged 4.4 mb/d in October, 0.5 mb/d below our projection. Logistical problems in
the delivery of crude to far east refiners as well as maintenance at Lukoil’s refineries, deferred from
September, are behind the lower throughput. Preliminary data for November show crude runs at
4.7 mb/d, 0.2 mb/d lower than expected. Accordingly, we have lowered by 0.2 mb/d our FSU 4Q09
forecast to 6.1 mb/d.
October Indian throughputs were in line with last month’s estimates, which include an estimation of
crude processed at Reliance’s Jamnagar expansion of around 0.5 mb/d. Similarly, elsewhere in Other
Asia, October crude runs were in accord with projections. However, we have revised down our 4Q09
Other Asia forecast by 0.1 mb/d to 8.5 mb/d as additional maintenance activity has been scheduled.

OECD Refinery Yields
September refinery yields increased for naphtha, gasoline and gasoil/diesel at the expense of jet
fuel/kerosene and fuel oil, while yields for other products remained unchanged. OECD gasoline yields as
a whole increased despite weaker crack spreads and lower yields in Europe and the Pacific. However,
gasoline gross output fell, as crude runs in OECD countries remained constrained. Gasoline is the only
product for which gross output remains above the five‐year average. Gasoline gross output is well above
that of last year as there were not hurricane related disruptions in the US Gulf Coast this year.

OECD - Gasoline OECD - Gasoline

mb/d
Refinery Yield - Five-year Range Refinery Gross Output
36% 15.50
35% 15.00
34% 14.50
33% 14.00
32% 13.50
31% 13.00
2008 2009 2008 2009

Gasoil/diesel yields continued around their five‐year average level, with gross output below the five‐year
average as middle distillates stocks levels continue above five‐year‐range levels. Gasoil/diesel gross
output remains particularly weak in Europe, 0.4 mb/d below last year’s level. In North America, gross
output remained unchanged at 5.1 mb/d during a month when output usually falls 0.4 mb/d according to
the five‐year average.
11 December 2009 51

OECD - Gasoil / Diesel OECD - Gasoil / Diesel

Refinery Yield - Five-year Range mb/d Refinery Gross Output
32% 14.00
31% 13.50
30%
13.00
29%
28% 12.50
27% 12.00
2008 2009
2008 2009

Naphtha yields increased, supported by a crack spread spike in the US Gulf Coast. Both yields and gross
output are recovering towards the five‐year range. Net imports in the Pacific have strengthened through
the year as demand from the petrochemical sector increases and gross output remains constrained at
the bottom of the five‐year range.
OECD - Naphtha OECD Pacific - Naphtha

Refinery Yield - Five-year Range Net imports - Five-year Range
6.0%
1,000
5.5% 900
800
5.0%
700
4.5%
600
4.0% 500
2008 2009 2008 2009

52 11 December 2009

I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT T ABLES
TABLES Table 1
WORLD OIL SUPPLY AND DEMAND

Table 1 - World Oil Supply and Demand
2006 2007 1Q08 2Q08 3Q08 4Q08 2008 1Q09 2Q09 3Q09 4Q09 2009 1Q10 2Q10 3Q10 4Q10 2010
OECD DEMAND
North America 25.4 25.5 24.8 24.4 23.6 23.9 24.2 23.5 22.9 23.3 23.4 23.3 23.4 23.1 23.6 23.6 23.4
Europe 15.7 15.3 15.3 15.1 15.5 15.4 15.3 14.9 14.2 14.5 14.7 14.6 14.8 14.3 14.6 14.8 14.6
Pacific 8.5 8.4 8.9 7.9 7.5 8.0 8.1 8.1 7.3 7.3 7.9 7.7 8.0 7.1 7.1 7.6 7.5
Total OECD 49.5 49.2 49.0 47.3 46.6 47.3 47.6 46.6 44.4 45.1 46.0 45.5 46.2 44.5 45.3 46.1 45.5
NON-OECD DEMAND
FSU 4.0 4.1 4.2 4.1 4.3 4.1 4.2 3.9 3.8 4.0 4.0 3.9 4.1 4.0 4.2 4.2 4.1
Europe 0.7 0.8 0.8 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7
China 7.2 7.6 7.9 8.0 8.1 7.6 7.9 7.7 8.6 8.8 8.6 8.4 8.4 8.9 8.8 8.7 8.7
Other Asia 9.0 9.5 9.9 9.9 9.4 9.5 9.7 9.9 10.1 9.7 9.8 9.9 10.3 10.3 10.0 10.1 10.2
Latin America 5.4 5.7 5.7 6.0 6.0 5.9 5.9 5.8 6.0 6.1 6.0 6.0 6.0 6.2 6.3 6.2 6.2
Middle East 6.3 6.5 6.7 7.1 7.6 7.0 7.1 6.7 7.3 7.8 7.1 7.2 7.1 7.6 8.0 7.5 7.6
Africa 3.0 3.1 3.2 3.2 3.1 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.3 3.3 3.3 3.3 3.3
Total Non-OECD 35.7 37.3 38.4 38.9 39.2 38.0 38.6 37.9 39.7 40.3 39.5 39.3 39.9 41.1 41.4 40.8 40.8
1
Total Demand 85.3 86.5 87.4 86.3 85.8 85.3 86.2 84.5 84.1 85.3 85.5 84.9 86.1 85.6 86.7 86.8 86.3
OECD SUPPLY
North America4 14.2 14.3 14.2 14.0 13.6 13.8 13.9 14.2 13.9 14.2 14.3 14.1 14.2 13.9 13.5 13.9 13.9
Europe 5.3 5.0 4.9 4.8 4.5 4.8 4.8 4.9 4.5 4.2 4.3 4.5 4.3 3.9 3.8 4.0 4.0
Pacific 0.6 0.6 0.6 0.7 0.7 0.7 0.6 0.7 0.6 0.7 0.7 0.7 0.7 0.8 0.8 0.8 0.8
Total OECD 20.1 19.9 19.7 19.5 18.8 19.3 19.3 19.7 19.0 19.0 19.2 19.2 19.2 18.6 18.1 18.7 18.6
NON-OECD SUPPLY
FSU 12.3 12.8 12.9 12.9 12.7 12.7 12.8 13.0 13.2 13.3 13.6 13.3 13.7 13.9 13.7 13.9 13.8
Europe 0.2 0.2 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1
China 3.7 3.7 3.8 3.8 3.8 3.8 3.8 3.7 3.8 3.8 3.9 3.8 4.0 4.0 4.0 4.1 4.0
2
Other Asia 3.8 3.7 3.7 3.6 3.6 3.7 3.7 3.6 3.6 3.6 3.6 3.6 3.7 3.7 3.8 3.8 3.7
Latin America2,4 3.9 3.9 4.1 4.1 4.2 4.2 4.1 4.3 4.3 4.3 4.4 4.3 4.5 4.5 4.6 4.7 4.6
Middle East 1.8 1.7 1.6 1.6 1.6 1.6 1.6 1.7 1.7 1.7 1.6 1.6 1.6 1.6 1.6 1.6 1.6
Africa2 2.5 2.6 2.6 2.6 2.6 2.5 2.6 2.5 2.5 2.5 2.5 2.5 2.5 2.4 2.4 2.4 2.4
Total Non-OECD 28.0 28.5 28.8 28.8 28.7 28.7 28.7 29.0 29.2 29.4 29.7 29.3 30.1 30.3 30.2 30.6 30.3
Processing Gains3 2.1 2.2 2.2 2.2 2.3 2.3 2.2 2.3 2.3 2.3 2.3 2.3 2.2 2.2 2.2 2.2 2.2
Other Biofuels4 0.2 0.3 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.5 0.4 0.4 0.5 0.5 0.5 0.5 0.5
Total Non-OPEC2 50.4 50.9 51.1 50.9 50.1 50.7 50.7 51.3 50.9 51.2 51.7 51.3 52.0 51.6 51.1 52.0 51.6
Non-OPEC: Historical Composition2 51.3 50.4 50.1 49.9 49.1 49.7 49.7 51.3 50.9 51.2 51.7 51.3 52.0 51.6 51.1 52.0 51.6
OPEC
Crude5 30.7 30.3 31.5 31.4 31.5 30.5 31.2 28.5 28.5 28.8
NGLs 4.3 4.3 4.4 4.4 4.5 4.6 4.5 4.6 4.7 5.0 5.2 4.9 5.4 5.6 5.9 6.0 5.7
Total OPEC2 35.0 34.7 35.9 35.8 36.1 35.2 35.7 33.1 33.2 33.9
OPEC: Historical Composition2 34.1 35.2 36.9 36.8 37.1 36.2 36.7 33.1 33.2 33.9
Total Supply6 85.4 85.6 87.0 86.7 86.2 85.9 86.4 84.4 84.0 85.0
STOCK CHANGES AND MISCELLANEOUS

Reported OECD
Industry 0.2 -0.3 0.1 0.4 0.6 0.5 0.4 0.5 0.1 0.1
Government 0.0 0.1 0.1 0.0 0.0 0.0 0.0 0.2 0.2 0.0
Total 0.3 -0.2 0.1 0.3 0.5 0.5 0.4 0.8 0.3 0.1
Floating Storage/Oil in Transit -0.1 0.0 0.3 0.0 -0.3 0.1 0.0 0.6 0.2 0.1
Miscellaneous to balance7 0.0 -0.8 -0.9 0.1 0.1 0.0 -0.2 -1.4 -0.5 -0.5
Total Stock Ch. & Misc 0.2 -0.9 -0.4 0.4 0.4 0.6 0.2 0.0 -0.1 -0.3
Memo items:
Call on OPEC crude + Stock ch.8 30.6 31.3 32.0 31.0 31.2 30.0 31.0 28.6 28.5 29.1 28.7 28.7 28.7 28.5 29.8 28.9 29.0
Adjusted Call on OPEC + Stock ch.9 30.5 30.5 31.1 31.1 31.3 29.9 30.8 27.2 28.0 28.6 28.2 28.0 28.3 28.0 29.3 28.4 28.5
1 Measured as deliveries from refineries and primary stocks, comprises inland deliveries, international marine bunkers, refinery fuel, crude for direct burning,
oil from non-conventional sources and other sources of supply.
2 Other Asia includes Indonesia throughout. Latin America excludes Ecuador throughout. Africa excludes Angola throughout.
Total Non-OPEC excludes all countries that were members of OPEC at 1 January 2009. Non-OPEC Historical Composition excludes countries that were OPEC members at that point in time.
Total OPEC comprises all countries which were OPEC members at 1 January 2009. OPEC Historical Composition comprises countries which were OPEC members at that point in time.
3 Net volumetric gains and losses in the refining process (excludes net gain/loss in China and non-OECD Europe) and marine transportation losses.
4 Other Biofuels are from sources outside Brazil and US. North and Latin America oil supply totals include US and Brazilian ethanol.
5 As of the March 2006 OMR, Venezuelan Orinoco heavy crude production is included within Venezuelan crude estimates. Orimulsion fuel remains within the OPEC NGL &
non-conventional category, but Orimulsion production reportedly ceased from January 2007.
6 Comprises crude oil, condensates, NGLs, oil from non-conventional sources and other sources of supply.
7 Includes changes in non-reported stocks in OECD and non-OECD areas.
8 Equals the arithmetic difference between total demand minus total non-OPEC supply minus OPEC NGLs.
9 Equals the "Call on OPEC + Stock Ch." with "Miscellaneous to balance" added for historical periods and with an average of "Miscellaneous to balance" for the most recent 8 quarters added for forecast periods.

T ABLES I NTERNATIONAL E NERGY A GENCY ‐ O IL M ARKET R EPORT
Table 1a - World Oil Supply and Demand:Table 1A

Changes from Last Month’s Table 1
WORLD OIL SUPPLY AND DEMAND: CHANGES FROM LAST MONTH'S TABLE 1
2006 2007 1Q08 2Q08 3Q08 4Q08 2008 1Q09 2Q09 3Q09 4Q09 2009 1Q10 2Q10 3Q10 4Q10 2010
OECD DEMAND
North America - - - - - - - - - 0.2 -0.4 - - - 0.2 -0.1 -
Europe - - - - - - - - - - - - - - - - -
Pacific - - - - - - - - - 0.1 0.2 0.1 - - 0.1 0.1 -
Total OECD - - - - - - - - - 0.2 -0.2 - - 0.1 0.2 - 0.1
NON-OECD DEMAND
FSU - - - -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 - - - - -
Europe - - - - - - - - - - - - - - - - -
China - - - - - - - - - - 0.3 0.1 0.1 0.1 - 0.1 0.1
Other Asia - - - - - - - - - 0.1 0.1 - - - - 0.1 -
Latin America - - - - - - - - - - 0.1 - - - - - -
Middle East - - - - - - - - - - - - - - -0.1 - -
Africa - - - - - - - - - - - - - - - - -
Total Non-OECD - - - -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 - 0.3 - 0.1 - -0.1 0.2 0.1
Total Demand - - -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 0.2 0.1 - 0.1 0.1 0.2 0.2 0.1
OECD SUPPLY
North America - - - - - - - - - - 0.1 - -0.2 -0.2 -0.4 -0.3 -0.3
Europe - - - - - - - - - - -0.1 - - - -0.1 -0.2 -0.1
Pacific - - - - - - - - - - - - - - - - -
Total OECD - - - - - - - - - 0.1 - - -0.2 -0.3 -0.5 -0.5 -0.4
NON-OECD SUPPLY
FSU - - - - - - - 0.1 0.1 0.1 0.2 0.1 0.2 0.2 0.2 0.2 0.2
Europe - - - - - - - - - - - - - - - - -
China - - - - - - - - - - -0.1 - - - - - -
Other Asia - - - - - - - - - - - - - - - - -
Latin America - - - - - - - - - - - - - -0.1 -0.1 -0.1 -0.1
Middle East - - - - - - - - - - - - - - - - -
Africa - - - - - - - - - - - - - - - - -
Total Non-OECD - - - - - - - 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 - 0.1
Processing Gains - - - - - - - - - - - - - - - - -
Other Biofuels - - - - - - - - - - - - - - - - -
Total Non-OPEC - - 0.1 0.1 - - 0.1 0.1 0.1 0.2 0.1 0.1 -0.1 -0.1 -0.4 -0.4 -0.3
Non-OPEC: historical composition - 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.2 0.1 0.1 -0.1 -0.1 -0.4 -0.4 -0.3
OPEC
Crude - - - - - - - - - -
NGLs -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.1 -0.1 -0.2 - -0.1 - -0.2 -0.1
Total OPEC -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.1
OPEC: historical composition -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.2 -0.1
Total Supply -0.2 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -
STOCK CHANGES AND MISCELLANEOUS

REPORTED OECD
Industry - - - - - - - - - -
Government - - - - - - - - - -
Total - - - - - - - - - -
Floating Storage/Oil in Transit - - - - - - - - - -
Miscellaneous to balance -0.2 -0.1 - - - - - - -0.1 -0.1
Total Stock Ch. & Misc -0.2 -0.1 - - - - - - -0.1 -0.1
Memo items:
Call on OPEC crude + Stock ch. 0.2 0.1 - - - - - - 0.1 0.1 0.1 0.1 0.2 0.3 0.6 0.8 0.5
Adjusted Call on OPEC + Stock ch. - - - - - - - - - - - - 0.1 0.3 0.6 0.8 0.4
When submitting their monthly oil statistics, OECD Member countries periodically update data for prior periods. Similar updates to non-OECD data can occur.

Table 2 - Summary of Global Oil Demand Table 2

SUMMARY OF GLOBAL OIL DEMAND
2007 1Q08 2Q08 3Q08 4Q08 2008 1Q09 2Q09 3Q09 4Q09 2009 1Q10 2Q10 3Q10 4Q10 2010
Demand (mb/d)
North America 25.47 24.77 24.42 23.57 23.93 24.17 23.52 22.92 23.31 23.37 23.28 23.45 23.14 23.58 23.63 23.45
Europe 15.34 15.32 15.06 15.52 15.41 15.33 14.91 14.23 14.47 14.75 14.59 14.81 14.28 14.61 14.80 14.63
Pacific 8.37 8.91 7.86 7.54 7.97 8.07 8.14 7.30 7.28 7.90 7.65 7.95 7.13 7.15 7.64 7.47
Total OECD 49.18 49.00 47.35 46.63 47.32 47.57 46.57 44.45 45.06 46.02 45.52 46.21 44.55 45.35 46.07 45.54
Asia 17.11 17.81 17.84 17.48 17.10 17.55 17.58 18.67 18.54 18.39 18.30 18.70 19.25 18.85 18.82 18.90
Middle East 6.53 6.72 7.13 7.57 6.95 7.10 6.71 7.32 7.75 7.13 7.23 7.08 7.61 8.04 7.50 7.56
Latin America 5.69 5.72 5.97 6.05 5.93 5.91 5.77 5.96 6.09 6.04 5.97 5.96 6.18 6.29 6.21 6.16
FSU 4.15 4.23 4.07 4.26 4.07 4.16 3.90 3.78 4.01 3.99 3.92 4.11 4.00 4.20 4.18 4.12
Africa 3.07 3.19 3.19 3.14 3.22 3.18 3.23 3.21 3.15 3.25 3.21 3.34 3.31 3.26 3.34 3.31
Europe 0.77 0.76 0.74 0.72 0.74 0.74 0.72 0.73 0.71 0.71 0.72 0.73 0.74 0.72 0.73 0.73
Total Non-OECD 37.32 38.44 38.94 39.20 38.01 38.65 37.91 39.66 40.26 39.52 39.34 39.92 41.08 41.35 40.78 40.79
World 86.51 87.44 86.28 85.83 85.33 86.22 84.48 84.11 85.31 85.54 84.86 86.13 85.63 86.70 86.85 86.33
of which: US50 20.68 20.04 19.76 18.90 19.30 19.50 18.96 18.54 18.70 18.70 18.72 18.87 18.71 18.91 18.95 18.86
Europe 5* 9.48 9.50 9.29 9.50 9.57 9.47 9.41 8.85 8.92 9.01 9.05 9.22 8.79 8.92 9.02 8.99
China 7.57 7.88 7.98 8.09 7.62 7.89 7.65 8.61 8.82 8.56 8.41 8.44 8.91 8.84 8.68 8.72
Japan 5.04 5.45 4.63 4.34 4.71 4.78 4.72 4.03 4.10 4.53 4.35 4.54 3.85 3.97 4.27 4.16
India 3.00 3.25 3.18 2.97 3.14 3.13 3.40 3.35 3.14 3.32 3.30 3.51 3.44 3.25 3.42 3.41
Russia 2.89 2.91 2.83 3.02 2.80 2.89 2.64 2.58 2.81 2.74 2.69 2.82 2.78 2.97 2.91 2.87
Brazil 2.35 2.37 2.46 2.53 2.51 2.47 2.39 2.48 2.57 2.58 2.51 2.49 2.58 2.66 2.64 2.59
Saudi Arabia 2.17 2.22 2.47 2.71 2.27 2.42 2.23 2.78 3.00 2.47 2.62 2.43 2.88 3.12 2.62 2.76
Canada 2.31 2.31 2.19 2.25 2.26 2.25 2.20 2.08 2.22 2.28 2.20 2.22 2.13 2.28 2.29 2.23
Korea 2.24 2.35 2.11 2.10 2.14 2.17 2.34 2.17 2.07 2.26 2.21 2.32 2.16 2.05 2.23 2.19
Mexico 2.14 2.12 2.19 2.14 2.07 2.13 2.05 2.01 2.10 2.09 2.06 2.04 2.02 2.10 2.07 2.06
Iran 1.72 1.86 1.89 1.86 1.83 1.86 1.77 1.73 1.73 1.80 1.76 1.85 1.84 1.84 1.91 1.86
Total 61.58 62.25 61.00 60.42 60.22 60.97 59.77 59.23 60.18 60.32 59.88 60.75 60.09 60.91 61.01 60.69
% of World 71.2% 71.2% 70.7% 70.4% 70.6% 70.7% 70.8% 70.4% 70.5% 70.5% 70.6% 70.5% 70.2% 70.3% 70.3% 70.3%
Annual Change (% per annum)
North America 0.4 -3.3 -3.6 -7.5 -5.9 -5.1 -5.1 -6.2 -1.1 -2.3 -3.7 -0.3 1.0 1.2 1.1 0.7
Europe -2.1 0.6 0.7 0.3 -1.8 -0.1 -2.7 -5.5 -6.8 -4.3 -4.8 -0.7 0.3 1.0 0.4 0.3
Pacific -1.0 0.0 -0.6 -4.9 -8.9 -3.6 -8.6 -7.2 -3.4 -0.9 -5.1 -2.3 -2.3 -1.8 -3.3 -2.4
Total OECD -0.7 -1.5 -1.8 -4.6 -5.1 -3.3 -5.0 -6.1 -3.4 -2.7 -4.3 -0.8 0.2 0.6 0.1 0.0
Asia 5.1 5.7 2.8 3.5 -1.5 2.6 -1.3 4.6 6.1 7.6 4.2 6.4 3.1 1.6 2.3 3.3
Middle East 3.2 4.9 9.2 12.4 7.6 8.6 -0.2 2.6 2.4 2.6 1.9 5.5 3.9 3.8 5.1 4.5
Latin America 5.5 4.9 5.3 4.0 1.7 3.9 0.9 -0.1 0.7 2.0 0.9 3.3 3.7 3.2 2.7 3.2
FSU 2.7 2.6 2.7 1.4 -5.4 0.2 -8.0 -7.1 -5.8 -2.1 -5.8 5.6 5.8 4.7 4.9 5.2
Africa 4.0 3.1 5.4 4.0 2.5 3.7 1.2 0.7 0.5 0.9 0.8 3.3 3.3 3.3 3.0 3.2
Europe 3.6 0.3 -0.4 -7.3 -5.2 -3.3 -5.1 -1.7 -1.2 -4.2 -3.1 1.3 1.5 1.7 2.3 1.7
Total Non-OECD 4.4 4.7 4.4 4.7 0.4 3.6 -1.4 1.9 2.7 4.0 1.8 5.3 3.6 2.7 3.2 3.7
World 1.5 1.1 0.9 -0.6 -2.8 -0.3 -3.4 -2.5 -0.6 0.2 -1.6 2.0 1.8 1.6 1.5 1.7
Annual Change (mb/d)
North America 0.09 -0.85 -0.92 -1.92 -1.50 -1.30 -1.25 -1.51 -0.26 -0.56 -0.89 -0.07 0.22 0.27 0.25 0.17
Europe -0.34 0.09 0.10 0.05 -0.28 -0.01 -0.41 -0.83 -1.05 -0.66 -0.74 -0.10 0.05 0.14 0.05 0.04
Pacific -0.09 0.00 -0.05 -0.39 -0.78 -0.30 -0.77 -0.56 -0.26 -0.07 -0.41 -0.19 -0.17 -0.13 -0.26 -0.19
Total OECD -0.33 -0.75 -0.87 -2.26 -2.57 -1.61 -2.43 -2.90 -1.57 -1.30 -2.05 -0.36 0.10 0.29 0.05 0.02
Asia 0.83 0.95 0.49 0.58 -0.25 0.44 -0.23 0.83 1.07 1.30 0.74 1.12 0.58 0.30 0.43 0.61
Middle East 0.20 0.32 0.60 0.84 0.49 0.56 -0.01 0.18 0.19 0.18 0.14 0.37 0.29 0.29 0.36 0.33
Latin America 0.30 0.27 0.30 0.23 0.10 0.22 0.05 -0.01 0.04 0.12 0.05 0.19 0.22 0.20 0.16 0.19
FSU 0.11 0.11 0.11 0.06 -0.23 0.01 -0.34 -0.29 -0.25 -0.09 -0.24 0.22 0.22 0.19 0.20 0.21
Africa 0.12 0.10 0.16 0.12 0.08 0.11 0.04 0.02 0.02 0.03 0.03 0.11 0.11 0.10 0.10 0.10
Europe 0.03 0.00 0.00 -0.06 -0.04 -0.02 -0.04 -0.01 -0.01 -0.03 -0.02 0.01 0.01 0.01 0.02 0.01
Total Non-OECD 1.59 1.74 1.65 1.78 0.15 1.33 -0.53 0.72 1.05 1.50 0.69 2.01 1.42 1.10 1.27 1.45
World 1.26 0.99 0.78 -0.48 -2.42 -0.29 -2.96 -2.18 -0.52 0.21 -1.35 1.65 1.53 1.38 1.31 1.47
Revisions to Oil Demand from Last Month's Report (mb/d)
North America 0.00 0.00 0.00 -0.01 0.00 0.00 0.00 0.00 0.19 -0.36 -0.04 0.01 0.03 0.18 -0.12 0.03
Europe 0.00 -0.02 -0.01 -0.03 -0.02 -0.02 -0.01 0.00 -0.03 -0.05 -0.02 0.00 0.02 -0.01 0.01 0.01
Pacific 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.06 0.18 0.06 0.00 0.00 0.07 0.09 0.04
Total OECD 0.00 -0.02 -0.01 -0.04 -0.02 -0.02 -0.01 0.00 0.21 -0.22 -0.01 0.01 0.05 0.24 -0.02 0.07
Asia 0.00 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01 0.00 0.07 0.38 0.11 0.15 0.07 0.03 0.22 0.12
Middle East 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -0.03 -0.04 -0.02 0.00 -0.02 -0.07 -0.01 -0.02
Latin America 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -0.01 0.05 0.01 0.00 0.00 0.00 0.01 0.00
FSU 0.00 -0.03 -0.06 -0.07 -0.08 -0.06 -0.08 -0.08 -0.07 -0.10 -0.08 -0.03 -0.01 -0.02 -0.02 -0.02
Africa 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -0.01 0.00 -0.01 -0.01 -0.01 -0.03 -0.01
Europe 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total Non-OECD 0.00 -0.03 -0.06 -0.08 -0.08 -0.06 -0.09 -0.07 -0.03 0.28 0.02 0.11 0.03 -0.06 0.17 0.06
World 0.00 -0.05 -0.07 -0.12 -0.11 -0.09 -0.10 -0.07 0.18 0.06 0.02 0.11 0.09 0.18 0.16 0.13
Revisions to Oil Demand Growth from Last Month's Report (mb/d)
World 0.00 -0.05 -0.08 -0.12 -0.11 -0.09 -0.05 0.00 0.30 0.16 0.10 0.21 0.16 0.00 0.10 0.12
* France, Germany, Italy, Spain & UK

Table 3
Table 3 - World Oil Production WORLD OIL PRODUCTION
2008 2009 2010 2Q09 3Q09 4Q09 1Q10 2Q10 Sep 09 Oct 09 Nov 09
OPEC
Crude Oil
Saudi Arabia 8.90 7.91 7.94 7.92 8.01 8.01
Iran 3.90 3.72 3.77 3.70 3.66 3.70
Iraq 2.38 2.45 2.55 2.51 2.47 2.52
UAE 2.59 2.25 2.27 2.27 2.28 2.27
Kuwait 2.31 1.98 1.97 1.96 2.00 2.00
Neutral Zone 0.57 0.54 0.54 0.54 0.54 0.54
Qatar 0.85 0.77 0.76 0.76 0.77 0.77
Angola 1.85 1.71 1.80 1.86 1.90 1.90
Nigeria 1.95 1.77 1.76 1.85 1.90 1.98
Libya 1.72 1.53 1.55 1.55 1.52 1.52
Algeria 1.37 1.25 1.22 1.22 1.24 1.24
Ecuador 0.50 0.48 0.46 0.46 0.46 0.46
Venezuela 2.35 2.12 2.20 2.24 2.24 2.22
6
Total Crude Oil 31.24 28.48 28.80 28.84 28.99 29.13
1,6
Total NGLs 4.51 4.86 5.72 4.67 5.05 5.17 5.42 5.57 5.05 5.17 5.17
6
Total OPEC 35.74 33.15 33.85 33.89 34.16 34.29
6
OPEC: Historical Composition 36.74 33.15 33.85 33.89 34.16 34.29
2
NON-OPEC
OECD
North America 13.91 14.13 13.89 13.87 14.17 14.29 14.21 13.88 14.28 14.31 14.27
5
United States 7.52 8.05 7.93 7.97 8.13 8.25 8.01 8.03 8.29 8.28 8.24
Mexico 3.16 2.97 2.80 2.97 2.94 2.93 2.89 2.83 2.96 2.96 2.92
Canada 3.22 3.12 3.16 2.93 3.11 3.11 3.31 3.02 3.04 3.07 3.12
Europe 4.76 4.46 4.00 4.48 4.21 4.26 4.28 3.95 4.00 4.25 4.27
UK 1.56 1.46 1.29 1.56 1.26 1.40 1.42 1.29 1.23 1.41 1.40
Norway 2.46 2.33 2.06 2.27 2.29 2.20 2.20 2.01 2.11 2.20 2.21
Others 0.74 0.67 0.65 0.66 0.66 0.65 0.66 0.65 0.66 0.64 0.66
Pacific 0.65 0.66 0.76 0.64 0.67 0.69 0.72 0.77 0.65 0.68 0.69
Australia 0.55 0.56 0.64 0.54 0.57 0.57 0.59 0.65 0.55 0.56 0.57
Others 0.10 0.10 0.12 0.09 0.10 0.12 0.13 0.13 0.11 0.12 0.13
Total OECD 19.32 19.25 18.65 18.98 19.05 19.23 19.21 18.60 18.94 19.25 19.23
NON-OECD
Former USSR 12.81 13.28 13.78 13.23 13.34 13.57 13.70 13.89 13.36 13.54 13.53
Russia 10.00 10.20 10.40 10.15 10.25 10.37 10.40 10.43 10.32 10.35 10.35
Others 2.80 3.08 3.38 3.08 3.09 3.20 3.30 3.46 3.04 3.19 3.18
Asia 7.45 7.43 7.75 7.40 7.44 7.54 7.69 7.69 7.45 7.46 7.54
China 3.79 3.82 4.02 3.80 3.84 3.92 3.99 3.99 3.84 3.84 3.95
Malaysia 0.77 0.74 0.72 0.74 0.74 0.74 0.73 0.72 0.74 0.74 0.73
India 0.81 0.80 0.87 0.80 0.79 0.82 0.83 0.85 0.80 0.81 0.82
Indonesia 1.00 0.98 1.02 0.97 0.98 0.98 1.01 1.01 0.98 0.98 0.98
Others 1.08 1.09 1.12 1.10 1.09 1.08 1.12 1.12 1.09 1.10 1.06
Europe 0.14 0.13 0.13 0.13 0.14 0.13 0.13 0.13 0.14 0.13 0.13
Latin America 4.13 4.33 4.57 4.31 4.31 4.39 4.50 4.52 4.40 4.40 4.38
5
Brazil 2.37 2.50 2.68 2.49 2.51 2.51 2.62 2.65 2.55 2.55 2.50
Argentina 0.75 0.73 0.72 0.73 0.70 0.72 0.73 0.72 0.72 0.72 0.73
Colombia 0.59 0.67 0.74 0.66 0.67 0.72 0.72 0.72 0.70 0.70 0.72
Others 0.42 0.43 0.43 0.43 0.43 0.43 0.43 0.43 0.44 0.44 0.43
3
Middle East 1.64 1.65 1.64 1.66 1.66 1.63 1.63 1.64 1.66 1.63 1.63
Oman 0.75 0.80 0.86 0.79 0.82 0.80 0.83 0.85 0.82 0.80 0.80
Syria 0.39 0.37 0.33 0.37 0.36 0.35 0.35 0.34 0.36 0.36 0.35
Yemen 0.31 0.29 0.27 0.30 0.29 0.28 0.27 0.27 0.28 0.28 0.28
Others 0.19 0.19 0.18 0.19 0.19 0.19 0.18 0.18 0.19 0.19 0.19
Africa 2.56 2.50 2.44 2.52 2.51 2.47 2.46 2.45 2.50 2.44 2.48
Egypt 0.69 0.66 0.62 0.67 0.65 0.64 0.63 0.62 0.65 0.65 0.64
Gabon 0.21 0.23 0.24 0.22 0.23 0.24 0.24 0.24 0.24 0.24 0.24
Others 1.66 1.62 1.59 1.63 1.62 1.59 1.59 1.59 1.61 1.56 1.60
Total Non-OECD 28.73 29.33 30.31 29.24 29.40 29.72 30.12 30.30 29.50 29.61 29.69
4
Processing Gains 2.24 2.29 2.20 2.29 2.29 2.29 2.20 2.20 2.29 2.29 2.29
5
Other Biofuels 0.39 0.41 0.49 0.39 0.45 0.43 0.45 0.46 0.46 0.43 0.43
6
TOTAL NON-OPEC 50.69 51.27 51.65 50.90 51.18 51.67 51.98 51.57 51.18 51.58 51.64
6
Non-OPEC: Historical Composition 49.69 51.27 51.65 50.90 51.18 51.67 51.98 51.57 51.18 51.58 51.64
TOTAL SUPPLY 86.44 84.05 85.03 85.07 85.74 85.94
1 Includes condensates reported by OPEC countries, oil from non-conventional sources, e.g. Venezuelan Orimulsion (but not Orinoco extra-heavy oil),
and non-oil inputs to Saudi Arabian MTBE. Orimulsion production reportedly ceased from January 2007.
2 Comprises crude oil, condensates, NGLs and oil from non-conventional sources
3 Includes small amounts of production from Israel, Jordan and Bahrain.
4 Net volumetric gains and losses in refining (excludes net gain/loss in China and non-OECD Europe) and marine transportation losses.
5 Other Biofuels are from sources outside Brazil and US. US and Brazil oil supply include ethanol.
6 Total OPEC comprises all countries which were OPEC members at 1 January 2009. OPEC Historical Composition comprises countries which were OPEC members at that point in time.
Total Non-OPEC excludes all countries that were OPEC members at 1 January 2009. Non-OPEC Historical Composition excludes countries that were OPEC members at that point in time.

Table 4 - OECD Industry Stocks and QuarterlyTable 4 Stock Changes/OECD Government-

Controlled Stocks and INDUSTRY
OECD Quarterly STOCKS
Stock Changes
1
AND QUARTERLY STOCK CHANGES
2 2
RECENT MONTHLY STOCKS PRIOR YEARS' STOCKS STOCK CHANGES
in Million Barrels in Million Barrels in mb/d
Jun2009 Jul2009 Aug2009 Sep2009 Oct2009* Oct2006 Oct2007 Oct2008 4Q2008 1Q2009 2Q2009 3Q2009
North America
Crude 497.0 493.1 478.1 473.5 474.4 473.4 449.6 464.2 0.16 0.49 -0.15 -0.26
Motor Gasoline 243.7 239.1 235.1 240.9 235.7 233.0 225.8 225.0 0.27 0.06 -0.05 -0.03
Middle Distillate 234.1 237.1 242.3 248.9 242.7 216.4 207.0 197.1 0.22 0.00 0.19 0.16
Residual Fuel Oil 44.7 42.8 41.1 44.0 43.7 51.4 47.0 47.7 -0.04 0.03 -0.03 -0.01
3
Total Products 723.9 726.9 728.5 741.4 719.4 701.3 666.5 656.0 0.32 0.02 0.42 0.19
4
Total 1382.9 1384.1 1370.1 1381.9 1362.3 1338.8 1277.8 1289.2 0.25 0.53 0.39 -0.01
Europe
Crude 343.0 338.9 335.8 329.0 322.2 334.6 323.4 331.6 0.10 0.15 -0.14 -0.15
Motor Gasoline 99.3 96.9 99.0 101.1 100.7 104.2 101.8 98.1 0.11 -0.08 -0.03 0.02
Middle Distillate 282.3 287.3 300.1 289.3 283.5 255.3 235.3 256.4 0.11 0.02 0.06 0.08
Residual Fuel Oil 80.7 68.8 71.9 72.6 70.7 76.9 71.8 75.2 0.08 -0.05 0.03 -0.09
3
Total Products 566.0 557.2 578.3 572.6 563.6 540.6 513.1 541.3 0.32 -0.12 0.01 0.07
4
Total 976.3 965.2 983.2 969.5 953.6 944.6 911.7 945.8 0.47 -0.01 -0.17 -0.07
Pacific
Crude 170.2 170.5 165.4 166.0 170.9 178.2 174.0 163.1 0.01 0.08 0.00 -0.05
Motor Gasoline 26.1 23.8 24.2 25.1 25.0 23.8 22.1 23.9 -0.02 0.06 0.00 -0.01
Middle Distillate 62.3 67.4 71.4 72.5 69.1 87.5 72.8 74.2 -0.10 -0.09 0.06 0.11
Residual Fuel Oil 18.9 19.3 21.8 21.3 21.5 23.5 21.8 20.7 -0.02 0.00 -0.01 0.03
3
Total Products 164.8 170.3 182.8 185.2 182.4 209.7 187.1 194.1 -0.20 -0.07 -0.05 0.22
4
Total 401.0 406.9 414.2 419.3 418.8 459.8 431.8 433.2 -0.25 0.01 -0.08 0.20
Total OECD
Crude 1010.2 1002.5 979.2 968.4 967.5 986.2 947.0 958.9 0.27 0.72 -0.28 -0.45
Motor Gasoline 369.0 359.7 358.2 367.1 361.4 361.1 349.7 347.0 0.36 0.05 -0.09 -0.02
Middle Distillate 578.7 591.8 613.9 610.8 595.3 559.1 515.1 527.7 0.22 -0.07 0.30 0.35
Residual Fuel Oil 144.3 130.8 134.7 137.9 135.9 151.8 140.6 143.6 0.02 -0.01 -0.01 -0.07
3
Total Products 1454.7 1454.4 1489.6 1499.1 1465.3 1451.6 1366.7 1391.4 0.45 -0.16 0.38 0.48
4
Total 2760.2 2756.2 2767.5 2770.6 2734.6 2743.2 2621.3 2668.2 0.47 0.53 0.14 0.11
5
OECD GOVERNMENT-CONTROLLED STOCKS AND QUARTERLY STOCK CHANGES
2 2
RECENT MONTHLY STOCKS PRIOR YEARS' STOCKS STOCK CHANGES
in Million Barrels in Million Barrels in mb/d
Jun2009 Jul2009 Aug2009 Sep2009 Oct2009* Oct2006 Oct2007 Oct2008 4Q2008 1Q2009 2Q2009 3Q2009
North America
Crude 724.1 724.1 724.1 725.1 725.1 688.6 694.1 701.8 -0.01 0.12 0.12 0.01
Products 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 0.00 0.00 0.00 0.00
Europe
Crude 186.7 185.6 186.1 186.3 186.3 174.7 180.6 185.5 0.07 0.01 -0.01 0.00
Products 238.3 239.5 240.6 240.8 240.8 234.7 234.7 229.5 -0.05 0.06 0.05 0.03
Pacific
Crude 389.1 388.5 388.5 388.4 388.4 381.5 385.0 384.7 0.03 0.02 0.00 -0.01
Products 19.2 19.2 19.2 19.2 19.2 11.8 18.4 19.2 0.00 0.00 0.00 0.00
Total OECD
Crude 1299.9 1298.1 1298.7 1299.8 1299.8 1244.8 1259.7 1272.0 0.10 0.16 0.11 0.00
Products 259.5 260.7 261.8 262.0 262.0 248.5 255.0 250.6 -0.05 0.06 0.05 0.03
4
Total 1561.0 1560.6 1562.2 1563.5 1563.5 1494.3 1515.8 1523.6 0.05 0.23 0.15 0.03
* estimated
1 Stocks are primary national territory stocks on land (excluding utility stocks and including pipeline and entrepot stocks where known) and include stocks held by
industry to meet IEA, EU and national emergency reserve commitments and are subject to government control in emergencies.
2 Closing stock levels.
3 Total products includes gasoline, middle distillates, fuel oil and other products.
4 Total includes NGLs, refinery feedstocks, additives/oxygenates and other hydrocarbons.
5 Includes government-owned stocks and stock holding organisation stocks held for emergency purposes.

Table 5
Table 5 - Total Stocks onTOTAL
Land STOCKS
in OECDONCountries/Total OECD Stocks
LAND IN OECD COUNTRIES
1
('millions of barrels' and 'days')
3
End September 2008 End December 2008 End March 2009 End June 2009 End September 2009
Stock Days Fwd2 Stock Days Fwd Stock Days Fwd Stock Days Fwd Stock Days Fwd
Level Demand Level Demand Level Demand Level Demand Level Demand
North America
Canada 198.4 88 193.9 88 197.7 95 197.8 89 190.1 -
Mexico 55.7 27 50.3 25 45.5 23 48.1 23 50.2 -
4
United States 1706.4 88 1738.7 92 1797.0 97 1841.0 99 1846.5 -
4
Total 1982.6 83 2005.1 86 2062.3 90 2108.9 91 2108.9 90
Pacific
Australia 38.9 40 41.4 45 40.8 43 40.5 42 45.0 -
Japan 646.2 137 629.6 133 611.3 152 611.2 149 607.3 -
Korea 141.2 66 134.9 58 155.2 72 149.1 72 167.0 -
New Zealand 7.9 53 7.9 51 9.5 61 8.5 56 7.5 -
Total 834.1 105 813.8 100 816.8 112 809.3 111 826.8 105
5
Europe
Austria 21.5 79 23.2 82 20.9 78 20.4 72 20.4 -
Belgium 31.1 43 34.9 56 35.8 65 35.0 59 34.7 -
Czech Republic 19.1 97 21.4 114 22.7 111 22.0 98 21.8 -
Denmark 18.3 101 22.9 131 25.1 152 26.4 161 24.9 -
Finland 30.1 139 30.7 147 33.5 167 25.4 122 29.3 -
France 176.6 87 179.2 89 177.6 98 172.9 95 174.0 -
Germany 273.7 103 277.4 108 277.7 116 280.2 117 276.7 -
Greece 39.2 83 40.0 83 36.7 93 35.9 94 35.5 -
Hungary 15.5 93 15.0 100 15.7 100 15.1 93 14.4 -
Ireland 10.5 54 11.4 63 11.5 74 11.7 78 12.4 -
Italy 130.3 81 127.9 83 131.0 86 129.1 82 129.0 -
Luxembourg 0.6 10 0.7 14 0.7 14 0.8 16 0.8 -
Netherlands 115.0 117 131.4 130 133.9 139 144.4 149 139.6 -
Norway 26.5 127 29.9 143 24.0 108 23.6 122 24.7 -
Poland 58.8 106 58.1 119 58.9 111 63.1 106 64.8 -
Portugal 25.0 90 24.7 92 25.0 90 24.8 91 24.5 -
Slovak Republic 8.0 93 8.8 122 9.8 123 8.4 99 8.3 -
Spain 135.8 88 137.6 89 137.8 94 135.6 92 135.4 -
Sweden 34.4 105 37.4 116 40.8 125 39.5 122 38.5 -
Switzerland 37.8 127 36.3 120 36.8 133 38.0 148 38.2 -
Turkey 60.8 98 60.9 111 59.2 97 58.8 93 57.8 -
United Kingdom 95.1 55 98.8 57 100.4 60 91.7 55 92.4 -
Total 1363.6 88 1408.6 94 1415.3 99 1402.9 97 1398.4 95
Total OECD 4180.4 88 4227.5 91 4294.4 97 4321.2 96 4334.1 94
6
DAYS OF IEA Net Imports - 124 - 131 - 134 - 135 - 135
1 Total Stocks are industry and government-controlled stocks (see breakdown in table below). Stocks are primary national territory stocks on land (excluding utility stocks
and including pipeline and entrepot stocks where known) they include stocks held by industry to meet IEA, EU and national emergency reserves commitments and are
subject to government control in emergencies.
2 Note that days of forward demand represent the stock level divided by the forward quarter average daily demand and is very different from the days of net
imports used for the calculation of IEA Emergency Reserves.
3 End September 2009 forward demand figures are IEA Secretariat forecasts.
4 US figures exclude US territories. Total includes US territories.
5 Data not available for Iceland.
6 Reflects stock levels and prior calendar year’s net imports adjusted to IEA emergency reserve definitions (see www.iea.org/netimports.asp). Net exporting IEA countries are excluded.
TOTAL OECD STOCKS

CLOSING STOCKS Total Government1 Industry Total Government1 Industry
controlled controlled
2
Millions of Barrels Days of Fwd. Demand
3Q2006 4255 1495 2760 85 30 55

4Q2006 4166 1499 2667 84 30 54
1Q2007 4106 1507 2598 85 31 54
2Q2007 4164 1506 2658 85 31 54
3Q2007 4170 1520 2650 83 30 53
4Q2007 4090 1524 2566 83 31 52
1Q2008 4101 1529 2572 86 32 54
2Q2008 4131 1526 2605 89 33 56
3Q2008 4180 1522 2658 88 32 56
4Q2008 4228 1527 2701 91 33 58
1Q2009 4294 1547 2747 97 35 62
2Q2009 4321 1561 2760 96 35 61
3Q2009 4334 1564 2771 94 34 60
1 Includes government-owned stocks and stock holding organisation stocks held for emergency purposes.
2 Days of forward demand calculated using actual demand except in 3Q2009 (when latest forecasts are used).


Table 6
Table 6 - IEA Member Country Destinations of Selected Crude Streams
1
IEA Member Country Destinations of Selected Crude Streams
Year Earlier
2006 2007 2008 4Q08 1Q09 2Q09 3Q09 Jul 09 Aug 09 Sep 09 Sep 08 change
Saudi Light & Extra Light

North America 0.60 0.73 0.70 0.63 0.58 0.51 0.45 0.56 0.36 0.41 0.74 -0.33
Europe 0.78 0.70 0.70 0.66 0.57 0.60 0.54 0.66 0.43 0.52 0.93 -0.41
Pacific 1.32 1.19 1.22 1.24 1.40 1.16 1.23 1.30 1.20 1.18 1.06 0.12
Saudi Medium
North America 0.64 0.56 0.64 0.66 0.42 0.45 0.40 0.44 0.34 0.44 0.69 -0.25
Europe 0.14 0.05 0.05 0.05 0.03 0.02 0.01 0.02 - 0.02 0.03 -0.02
Pacific 0.35 0.34 0.39 0.38 0.34 0.33 0.35 0.39 0.30 0.38 0.34 0.04
Saudi Heavy
North America 0.21 0.09 0.07 0.05 0.04 0.02 0.02 0.02 0.02 0.02 0.23 -0.21
Europe 0.18 0.11 0.09 0.09 0.03 0.03 0.01 0.00 0.01 0.02 0.12 -0.10
Pacific 0.23 0.20 0.24 0.25 0.22 0.15 0.12 0.13 0.12 0.11 0.31 -0.20
Iraqi Basrah Light2

North America 0.52 0.50 0.60 0.51 0.44 0.31 0.45 0.32 0.56 0.46 0.47 0.00
Europe 0.32 0.30 0.21 0.21 0.13 0.12 0.19 0.20 0.30 0.05 0.28 -0.23
Pacific 0.08 0.17 0.15 0.11 0.26 0.20 0.24 0.21 0.31 0.19 0.16 0.03
Iraqi Kirkuk
North America 0.00 - 0.08 0.06 0.07 0.02 0.11 0.13 0.07 0.14 - -
Europe 0.01 0.11 0.23 0.19 0.26 0.34 0.34 0.44 0.24 0.34 0.18 0.16
Pacific - - - - - - - - - - - -
Iranian Light
North America - - - - - - - - - - - -
Europe 0.26 0.27 0.23 0.24 0.15 0.16 0.13 0.05 0.17 0.15 0.21 -0.06
Pacific 0.13 0.09 0.08 0.07 0.11 0.06 0.06 0.08 0.06 0.04 0.05 -0.01
Iranian Heavy3
North America - - - - - - - - - - - -
Europe 0.58 0.56 0.49 0.43 0.33 0.41 0.47 0.51 0.48 0.40 0.65 -0.25
Pacific 0.56 0.64 0.61 0.64 0.65 0.51 0.57 0.56 0.57 0.58 0.66 -0.07
Venezuelan Light & Medium

North America 0.66 0.76 0.62 0.50 0.51 0.63 0.33 0.42 0.40 0.16 0.56 -0.41
Europe 0.11 0.08 0.06 0.07 0.07 0.13 0.04 0.08 0.01 0.04 0.01 0.03
Pacific - 0.01 - - - - - - - - - -
Venezuelan 22 API and heavier

North America 0.72 0.68 0.65 0.74 0.74 0.62 0.87 0.74 0.88 1.01 0.63 0.38
Europe 0.06 0.07 0.07 0.08 0.07 0.06 0.06 0.06 0.08 0.03 0.05 -0.03
Pacific - - - - - - - - - - - -
Mexican Maya
North America 1.24 1.22 1.02 1.04 1.06 0.96 0.87 0.83 0.92 0.86 0.77 0.09
Europe 0.16 0.14 0.14 0.12 0.08 0.09 0.09 0.10 0.08 0.09 0.08 0.01
Pacific - - - - - - - - - - - -
Mexican Isthmus
North America 0.04 0.01 0.01 0.00 0.01 0.00 0.01 0.01 0.01 - 0.00 -
Europe 0.01 0.02 0.01 0.02 0.01 - 0.02 0.03 0.03 - - -
Pacific - - - - - - - - - - - -
Russian Urals
North America 0.09 0.06 0.05 - 0.09 0.27 0.17 0.20 0.12 0.18 0.02 0.16
Europe 1.68 1.86 1.81 1.67 1.58 1.76 1.72 1.86 1.60 1.70 1.49 0.20
Pacific 0.00 0.00 - - - - - - - - - -
Nigerian Light4
North America 0.79 0.88 0.68 0.60 0.47 0.40 0.63 0.64 0.65 0.61 0.43 0.18
Europe 0.33 0.24 0.29 0.34 0.25 0.39 0.30 0.42 0.33 0.15 0.40 -0.25
Pacific 0.04 0.01 - - - 0.01 - - - - - -
Nigerian Medium
North America 0.17 0.23 0.27 0.22 0.14 0.30 0.19 0.28 0.13 0.18 0.14 0.03
Europe 0.10 0.07 0.14 0.14 0.12 0.12 0.12 0.09 0.07 0.20 0.13 0.07
Pacific 0.00 0.01 - - - - - - - - - -
1 Data based on monthly submissions from IEA countries to the crude oil import register (in '000 bbl), subject to availability. May differ from Table 8 of the Report.
IEA North America includes United States and Canada.
IEA Europe includes all countries in OECD Europe except Hungary. The Slovak Republic and Poland is excluded through December 2007 but included thereafter.
IEA Pacific data includes Australia, New Zealand, Korea and Japan.
2 Iraqi Total minus Kirkuk.
3 Iranian Total minus Iranian Light.
4 33 API and lighter (e.g., Bonny Light, Escravos, Qua Iboe and Oso Condensate).


Table 7
Table 7 - Regional OECD Imports
Regional OECD Imports1,2
(thousand barrels per day)
Year Earlier
2006 2007 2008 4Q08 1Q09 2Q09 3Q09 Jul-09 Aug-09 Sep-09 Sep-08 % change
Crude Oil
North America 8194 8214 8046 7886 7743 7541 7313 7519 7078 7342 6639 11%
Europe 9784 9684 9781 9548 9001 9132 8797 8918 8574 8902 10163 -12%
Pacific 6816 6718 6605 6408 6559 5706 5960 5829 6065 5987 6165 -3%
Total OECD 24794 24615 24431 23843 23304 22379 22069 22266 21716 22231 23247 -4%
LPG
North America 14 28 29 34 28 11 9 5 22 0 43 -100%
Europe 264 276 268 241 251 250 249 285 215 246 268 -8%
Pacific 578 557 589 543 504 518 566 501 544 654 522 25%
Total OECD 856 861 885 818 784 780 823 791 782 901 833 8%
Naphtha
North America 71 40 55 82 40 19 18 29 16 8 71 -88%
Europe 314 265 260 270 319 232 282 227 295 325 230 42%
Pacific 754 794 776 689 746 814 907 927 927 866 943 -8%
Total OECD 1138 1099 1091 1040 1105 1066 1207 1183 1238 1200 1244 -4%
3
Gasoline
North America 1143 1128 1080 1038 996 889 854 947 829 785 1292 -39%
Europe 160 203 218 197 239 280 247 293 166 282 202 39%
Pacific 96 73 90 105 120 71 97 85 69 139 73 90%
Total OECD 1399 1404 1389 1339 1355 1239 1198 1325 1063 1206 1567 -23%
Jet & Kerosene

North America 161 183 63 39 80 45 65 71 58 67 47 42%
Europe 374 370 402 468 454 462 449 454 377 517 365 42%
Pacific 69 43 34 33 79 49 37 42 36 32 27 16%
Total OECD 603 595 500 540 612 555 551 567 471 616 439 40%
Gasoil/Diesel
North America 175 132 72 94 106 39 48 17 18 112 93 21%
Europe 967 780 880 1039 1224 963 969 1245 867 788 953 -17%
Pacific 77 91 119 117 81 81 73 94 45 82 118 -31%
Total OECD 1219 1003 1072 1249 1410 1083 1090 1356 930 981 1164 -16%
Heavy Fuel Oil

North America 343 323 286 266 326 326 205 210 174 231 181 27%
Europe 476 433 448 462 474 567 643 799 561 567 427 33%
Pacific 91 95 125 94 144 128 103 99 116 94 132 -29%
Total OECD 910 851 859 821 943 1021 951 1109 852 891 740 20%
Other Products
North America 1121 1050 1075 1117 935 896 899 923 786 991 1092 -9%
Europe 929 854 763 750 737 776 828 892 847 743 828 -10%
Pacific 243 254 298 316 279 324 337 375 296 339 273 24%
Total OECD 2294 2157 2137 2182 1951 1996 2064 2190 1929 2073 2193 -5%
Total Products
North America 3028 2883 2660 2669 2509 2226 2098 2202 1903 2194 2818 -22%
Europe 3484 3180 3240 3427 3697 3530 3666 4195 3328 3468 3272 6%
Pacific 1908 1906 2032 1895 1952 1985 2120 2124 2033 2206 2090 6%
Total OECD 8420 7969 7932 7990 8159 7741 7884 8521 7264 7867 8180 -4%
Total Oil
North America 11222 11097 10706 10555 10253 9767 9411 9721 8981 9536 9737 -2%
Europe 13268 12864 13020 12975 12698 12662 12463 13113 11902 12370 13435 -8%
Pacific 8724 8623 8637 8303 8512 7691 8080 7953 8097 8193 8255 -1%
Total OECD 33214 32584 32363 31834 31463 30120 29953 30786 28980 30098 31427 -4%
1 Based on Monthly Oil Questionnaire data submitted by OECD countries in tonnes and converted to barrels.
2 Excludes intra-regional trade
3 Includes additives

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11 December 2009

REVIEWING THE MEDIUM-TERM HORIZON .......................................................................................................................... 3

REVIEWING THE MEDIUM-TERM HORIZON

Avg. Yearly Grow th, Avg. Yearly Grow th,

industry consolidation and uncertainty surrounding 1.6

Crude Distillation Capacity mb/d Crude Distillation Forecast

Global Balance Summary (Higher GDP Scenario)

2008 2009 2010 2011 2012 2013 2014

Changes since June 2009 MTOMR

mb/d Medium-Term Oil Market Balance (Higher GDP Scenario) mb/d

Effective OPEC Spare Capacity (RHS) World Demand Growth

mb/d Medium-Term Oil Market Balance (Lower GDP Scenario) mb/d

Effective OPEC Spare Capacity (RHS) World Demand Growth

-763 Middle East -240

Latin America Africa

10 11 D ECEMBER 2009

11 D ECEMBER 2009 11

OECD North America Demand by Product

12 11 D ECEMBER 2009

11 D ECEMBER 2009 13

14 11 D ECEMBER 2009

OECD Europe Demand by Product

11 D ECEMBER 2009 15

OECD Pacific: OECD Pacific: Demand by Driver,

16 11 D ECEMBER 2009

kb/d Korea: Naphtha Demand kb/d Korea: Motor Gasoline Demand

11 D ECEMBER 2009 17

China: Demand by Product

18 11 D ECEMBER 2009

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20 11 D ECEMBER 2009

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OPEC Crude Oil Supply

22 11 D ECEMBER 2009

OPEC’s condensate and natural gas liquids (NGL) capacity Previous Forecast Current Forecast

has also been raised, by a smaller 175 kb/d, with growth

Estimated Average Sustainable Crude Production Capacity

11 D ECEMBER 2009 23

24 11 D ECEMBER 2009

(excluding Iraq, Nigeria, Venezuela 5.35)

11 D ECEMBER 2009 25

26 11 D ECEMBER 2009

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2008 2009 2010 2011 2012 2013 2014

28 11 D ECEMBER 2009

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30 11 D ECEMBER 2009

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OECD Crude Oil Stocks OECD Middle Distillate Stocks

32 11 D ECEMBER 2009

days OECD Pacific Mid Distillate Stocks mb OECD North America mb

11 D ECEMBER 2009 33

mb US Weekly Industry Crude Oil mb US Weekly Cushing Crude Stocks

34 11 D ECEMBER 2009

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36 11 D ECEMBER 2009

Regional OECD End-of-Month Industry Stocks

Days Europe mb Europe

Days Pacific mb Pacific

Days OECD Total Oil mb OECD Total Oil

11 D ECEMBER 2009 37

$/bbl Benchmark Crude Prices $/bbl NYMEX WTI

38 11 D ECEMBER 2009