Oil prices posted their second consecutive weekly gains, after fresh U.S. sanctions on Iran and a new OPEC+ plan for seven members to cut output raised bets on tightening supply.
BKR Rig Count | The total active drilling rigs in the United States increased by 1 at 593. Oil rigs decreased by 1 to 486, and gas rigs increased by 2 to 102. Rig count in the Permian Basin decreased by 1 at 300 | Mar 21 | BKR NAM Rig Count
US Crude Inventories, excluding those in the Strategic Petroleum Reserve (SPR), increased by 1.7 MMbbl to 437 MMbbl (about 5% below the 5y average for this time of year). On the products side, gasoline decreased by 0.5 MMbbl (2% above the 5y average). Distillate fuels decreased by 2.8 MMbbl (6% below the 5y average). Total commercial petroleum inventories decreased by 1.6 MMbbl | Mar 14 | EIA Weekly Report
OPEC+ issued a new schedule for seven member nations to make further oil output cuts to compensate for pumping above agreed levels, which will more than overtake the monthly production hikes the group plans to introduce next month. The plan will represent monthly cuts of between 189,000 barrels per day and 435,000 bpd, scheduled to last until June 2026 | Mar 20 | OPEC, Reuters
The U.S issued new sanctions intended to hit Iran's oil exports. It was Washington's fourth round of sanctions on Iran's oil sales since President Donald Trump said in February he was re-imposing a "maximum pressure" on the country. The refinery the Treasury targeted for sanctions is China-based Shandong Shouguang Luqing Petrochemical. "So-called 'teapot' refinery purchases of Iranian oil provide the primary economic lifeline for the Iranian regime,” U.S. Treasury Secretary Scott Bessent said | Mar 21 | S&P
The United States launched airstrikes against Yemen's Houthis over the weekend in response to attacks disrupting shipping in the Red Sea. President Donald Trump intensified the situation by linking the Houthis to Iran, declaring that any attacks by the group would be treated as actions by Iran | Mar 21 | S&P
China's government announced of a fiscal stimulus plan to counteract US tariffs, which included measures to raise the minimum wage and stabilize markets, boosting expectations for increased oil demand in the country due to improved economic activity. This was supported by positive economic data from the country this week, showing that retail sales increased 4% year-on-year in January-February 2025 | Mar 21 | S&P
The chief executive of Petro, the Norwegian state's oil and gas holding company, has implored the industry to explore for more petroleum. “We need to explore for and find more gas in order to ensure stable and reliable deliveries to Europe over the long term.” | Mar 18 | Upstream
The chief executives of Canada's largest oil and gas companies have written an open letter to all the country's political parties requesting that construction of energy projects be fast-tracked in order to expand the nation's export markets beyond the US | Mar 20 | Upstream
Looking ahead
IEA Oil Market Report – March 2025 | Global oil demand is set to accelerate to just over 1 mb/d this year, from 830 kb/d in 2024, reaching 103.9 mb/d. Asia accounts for almost 60% of gains, led by China where petrochemical feedstocks will provide the entirety of growth. Amid an unusually uncertain macroeconomic climate, recent delivery data have been below expectations, leading to slightly lower estimates for 4Q24 and 1Q25 growth at 1.2 mb/d y-o-y. Global oil supply is projected to rise by 1.5 mb/d in 2025 to 104.5 mb/d, almost double the 2024 growth of 760 kb/d. Non-OPEC+ provides most of the increase at 1.5 mb/d, led by the Americas. Following a 770 kb/d output decline last year, OPEC+ output could hold steady in 2025 if voluntary cuts are maintained after April. Global oil supply rose by 240 kb/d in February to 103.3 mb/d, led by OPEC+. Kazakhstan pumped at an all-time high as Tengiz ramped up, while Iran and Venezuela boosted flows ahead of tighter sanctions. Global observed oil stocks fell by 40.5 mb in January, of which 26.1 mb were products. Non‑OECD crude stocks plunged by 45.3 mb, dominated by China where imports declined. Total OECD stocks rose by 11.2 mb, boosted by a 25 mb build in industry crude inventories. Oil on water fell by 6.7 mb. However, preliminary data for February show total global oil stocks rebounded, lifted by an increase in oil on water. Oil prices declined by about $7/bbl in February and early March as macro sentiment soured amid escalating trade tensions, clouding the outlook for oil demand growth. Plans by OPEC+ to start unwinding voluntary production cuts in April added to the expectation of comfortable crude balances in 2025 | Mar 13 | IEA OMR
OPEC Monthly Oil Market Report | Global oil demand in 2025 is forecast to expand by 1.4 mb/d, y-o-y, followed by a further 1.4 mb/d, y-o-y, in 2026. Most of the growth is expected in non-OECD economies, with an expansion of more than 1.3 mb/d, y-o-y, in both 2025 and 2026, with OECD oil demand growth at slightly above 0.1 mb/d, y-o-y, in both years. Transportation fuels are set to drive oil demand growth in both 2025 and 2026, followed by petrochemical industry requirements. Jet fuel demand is forecast to show the largest y-o-y expansion, supported by strong domestic air travel in all regions. Gasoline requirements are expected to continue to see support in major consuming countries and regions, such as China, the Middle East, India and the US. Both on-road diesel and solid industrial, construction and agricultural activities in non-OECD countries are expected to support diesel demand. Lastly, petrochemical feedstock growth is poised to be supported by capacity additions, as well as healthy petrochemical margins, mostly in China and the Middle East. Non-DoC liquids supply is forecast to grow by 1.0 mb/d, y-o-y, in 2025, unchanged from last month’s assessment, mainly driven by the US, Brazil, Canada, and Norway. Non-DoC liquids supply growth in 2026 also remains unchanged at 1.0 mb/d, mainly driven by the US, Brazil and Canada. Meanwhile, NGLs and non-conventional liquids from DoC countries are forecast to grow by 0.1 mb/d, y-o-y, in 2025, to average 8.4 mb/d, followed by an increase of about 0.1 mb/d, y-o-y, in 2026, to average 8.5 mb/d. This forecast remains unchanged from the previous MOMR despite trade challenges and potential developments in geopolitical dynamics. Trade concerns are expected to contribute to volatility as trade policies continue to be unveiled. However, the global economy is expected to adjust. Price pressures may weigh on global growth but are unlikely to disrupt overall growth momentum, which remains supported by resilient consumer demand and strong output in major emerging economies. At the same time, trade will continue to expand and likely accelerate among emerging economies outside the OECD, driven by regional trade agreements and continued rising consumption, which will partially offset potential disruptions. However, downside risks need to be monitored given uncertainties in policy rollout and subsequent effects and impacts | Mar 12 | OPEC
