The release of our Middle East oil demand data review was delayed while JODI corrected data for OPEC member countries.
Middle Eastern oil demand totalled 5.37 mb/d in March, lower m/m by 0.14 mb/d as the severe cold weather that gripped the region eased, but still higher y/y by 0.21 mb/d. Across Q1 14, Middle Eastern demand averaged 5.42 mb/d, and its y/y growth of 0.33 mb/d ranks amongst the highest globally. Support in March came from Saudi Arabia, where demand was broadly flat m/m at 2.04 mb/d, higher y/y by 71 thousand b/d; and UAE where demand was higher y/y by 0.11 mb/d. Iraqi demand fell back below 0.7 mb/d to 0.63 mb/d, as the severe winter weather eased, with crude and fuel oil burn easing m/m by 30 and 20 thousand b/d to 0.1 mb/d and 0.13 mb/d. Iranian demand was flat y/y despite restocking ahead of the retail price hikes in April. Fuel oil, which was the main driver of growth in February, fell back below 1 mb/d to a 13-month low at 0.94 mb/d, with Saudi demand lower m/m by 86 thousand b/d to 0.23 mb/d, the lowest since April 2013, although it stayed higher y/y. Across Q1 14, Saudi fuel oil demand rose y/y by 50 thousand b/d, compared to flat growth in Q1 13. Whilst gasoline demand declined marginally in the region, Saudi demand stayed at near record highs of 0.54 mb/d, higher y/y by 23 thousand b/d. We expect demand to pick up in the coming months as temperatures rise (coinciding with Ramadan in July) which will support crude and fuel oil burn.
Middle Eastern runs picked up m/m by 0.32 mb/d to 5.95 mb/d, largely due to Saudi runs increasing by 0.26 mb/d as planned (Yanbu and SAMREF) and unplanned works were completed. April had limited planned maintenance-clean fuel project tie-in at Riyadh and catalyst replacement at Rabigh. Offline capacity in May remains low at 0.13 mb/d, which falls to zero in June. The conversion units at the Jubail plant should be operational by end-June.