• Friday, July 19, 2024
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US 2014 fuel oil demand down 50% from 2009: EIA

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The demand for fuel oil by the United States fell to a record low of 257,000 b/d in 2014, down by half from 2009, according to US Energy Information Administration (EIA) data, showed on Friday.

According to leading oil data and analysis provider Platts, “this is further evidence the product’s utility is waning, further.

The United States, which is the world’s biggest oil consuming country, accounts for nearly 20% of the world’s total oil consumption per day. But oil consumption has been on the decline following the emergence of more energy efficient technology. The decline in US oil consumption during recent years is also attributed to increased natural gas production and consumption, and the use of more fuel-efficient vehicles.

Its imports of oil have also declined from 12 million barrels per day (mbpd) in 2005 to 7 mbpd in 2012, as its own total oil production steadily rose from 8.3mbd in 2005 to 11mbd in 2012.

Oil prices sank as demand for the commodity was unable to keep up with its supply, which boomed as a result of rising prices. Demand fell as major consuming countries struggled with growth, and inflation targets.

China, the largest consumer of commodities has recently been plagued with a housing slump, erratic growth in exports and a state-led slowdown in investment for the purpose of helping it restructure its economy. Last year, growth dragged to 7.4 percent, a level unseen since 1990.

Activity in China’s factory sector also contracted for a second straight month in February this year, on unsteady exports and slowing investment.

Asian countries however accommodated Nigeria’s oil supply in 2014, especially as output remained relatively stable during the period.

Asia’s four largest oil consumers — China, India, Japan and South Korea — collectively bought around 43% more Nigerian crude in 2014 compared with 2013.

While the Asian giants soaked up much more Nigerian crude last year, a closer look at their individual buying patterns revealed a fair amount of diversity: India dominated the Nigerian market, and ramped up its intake of crude from the country.

China, which has been the biggest buyer of the acidic Angolan crudes, eased its imports by 1% year on year to around 813,500 b/d over January-September 2014, according to Chinese customs data.

Oil prices (London Brent) rebounded by4.2 percent to close the week at $62.58 per barrel.

The US EIA’s December data showed that “it was another down year for fuel oil, which has set the consumption bar lower for nine consecutive years. The 2014 figure was no exception, even with increased [oil] demand from the electric sector during a brutal first quarter winter in the Northeast”, said Platts.

With domestic demand all but disappearing, the US has solidified itself as a net exporter of fuel oil, having been so since April 2011. US fuel oil exports averaged 362,000 b/d last year compared with 172,000 b/d for imports, EIA data show.

EDOZIE IFEBI