FX: Stronger dollar eases interest in precious metals
Crude oil and base metals hit by Chinese bank regulatory measures
Stronger dollar eases interest in precious metals
Crude oil eased on Tuesday due to tighter credit policy in China as Chinese bank regulators told some banks to temporarily halt lending in a renewed effort to rein in credit growth following a burst of frantic lending by Chinese financial institutions in the first weeks of the year. Moreover also a stronger dollar weights on lower crude price.
China processed 8.15 mln.b/d of crude oil in December, the National Bureau of Statistics said on Thursday, a new record as refiners geared up supplies to meet strong recovering demand. The December runs were 24.8 % above a year earlier. For the whole year of 2009, China's crude runs rose 7.9 % to 7.49 mln.b/d.
World oil markets are currently in balance and the IEA does not anticipate any big movements in oil prices this year, a senior IEA official was quoted Wednesday. He said world demand was projected to grow to 86.3 mln.b/d from 84.9 mln.b/d in 2009 while on the supply side, non-OPEC oil producers were set to add 1 mln.b/d oil equivalent to their output.
On the contrary OPEC expected demand for its crude oil this year to average 28.59 mln.b/d,, broadly unchanged from its previous forecast a month ago but some 550 kb below the 29.14 mln.b/d the group produced in December.
OPEC estimates the call on its crude at 28.26 mln.b/d in the first three months of this year but sees this falling by 890 kb/d in the second quarter to 27.37 mln.b/d.
This suggests that if OPEC maintains production around the December level over the next few months, it will be oversupplying the market by some 1.77mln.b/d in the second quarter. Using secondary sources, OPEC estimates that its 12 members pumped an average 29.14 mln.b/d in December and that, excluding Iraq, the 11 members bound by quotas produced 26.681 mln.b/d.
At the end OPEC has left its estimate of world oil demand in 2010 unchanged at 85.15 mln.b/d, saying the world economic outlook gives "a semi-rosy picture" for this year.
Sinopec Corp total crude throughput in 2009 rose 6.7% over 2008, with production accelerating in the fourth quarter as demand rebounded more strongly. The refiner processed 182.62 mln.t of crude last year, i.e. about 3.65 mln.b/d. The 6.7% gain outpaced the near 3 % growth reported in the first three quarters last year.
Saudi Aramco has offered its first fuel oil cargo from the Ras Tanura refinery in three months, indicating a 45-day shutdown of its 550 kb/d plant is over on schedule.
