TL;DR
Oil Prices and Market Sentiment: In December, oil prices saw mixed movements with ICE Brent and NYMEX WTI showing slight changes. Forward curves strengthened, and market sentiment improved as hedge funds reduced short positions.
Global Economic Outlook: Global GDP growth is projected at 3.1% in 2025 and 3.2% in 2026, driven by inflation stabilization and stronger services sectors, with notable growth in India and China.
Oil Demand and Supply: Global oil demand is expected to grow steadily by 1.4 mb/d annually through 2025 and 2026. Non-OPEC countries like the U.S., Brazil, and Canada will lead supply growth.
Refining and Trade Trends: Refining margins declined in key regions except Rotterdam, while global refinery throughput rose. U.S. product exports hit a record high, and China’s crude imports reached a 13-month peak.
Stock Levels and Balance: OECD oil stocks fell below the 2015–2019 average, while demand for OPEC crude is expected to grow slightly in 2025 and 2026, reflecting stable supply-demand dynamics.
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Oil Prices: Shifts and Market Sentiment
In December, the OPEC Reference Basket (ORB) increased by 9 cents (0.1%) compared with the previous month, averaging $73.07/b. ICE Brent front-month prices declined by 27 cents (0.4%) to an average of $73.13/b, while NYMEX WTI front-month prices rose by 16 cents (0.2%) to $69.70/b. GME Oman front-month prices gained 68 cents (0.9%), averaging $73.16/b.
The price spread between ICE Brent and NYMEX WTI for first-month contracts narrowed by 43 cents to $3.43/b. Forward curves strengthened, especially for NYMEX WTI and GME Oman, with near-month time spreads showing wider backwardation—an indication of a more optimistic market outlook. Hedge funds and other money managers adopted a positive market stance, closing a large volume of short positions in NYMEX WTI.

Global Economic Growth: Outlook for 2025 and 2026
Global economic growth is forecast at 3.1% in 2025, slightly improving to 3.2% in 2026. This outlook assumes inflation will gradually normalize, accompanied by monetary policy adjustments in major economies. Growth should continue to be driven by services, along with a moderate rebound in industrial output.
United States: Growth forecasts for 2025 are revised to 2.4%, with 2.3% expected in 2026.
Eurozone: Growth is expected at 1% in 2025, rising to 1.1% in 2026.
China: Forecasts remain steady at 4.7% for 2025 and 4.6% for 2026.
India: Growth is forecasted at 6.5% for both 2025 and 2026.
Brazil: Growth projections are revised up to 2.3% for 2025 and 2.5% in 2026.
World Oil Supply and Demand
For non-OPEC liquids supply (i.e., from countries not part of the Declaration of Cooperation), the forecast for 2025 shows an increase of 1.1 mb/d, led by the US, Brazil, Canada, and Norway. The same growth rate of 1.1 mb/d is expected in 2026, primarily driven by the US, Brazil, and Canada.
Natural gas liquids (NGLs) and non-conventional liquids from OPEC-participating countries are forecast to rise by about 90 tb/d in 2025 to an average of 8.4 mb/d, followed by an additional 0.1 mb/d increase in 2026 to 8.5 mb/d. In December, crude oil production by OPEC-participating countries fell by 14 tb/d (month-on-month) to an average of 40.65 mb/d, according to secondary sources.
The forecast for global oil demand growth in 2025 remains at 1.4 mb/d. Within this total, the OECD is expected to grow by 0.1 mb/d, while the non-OECD region should see an increase of 1.3 mb/d. A similar growth pattern is anticipated in 2026, with global oil demand again rising by 1.4 mb/d. The OECD is expected to contribute 0.1 mb/d and the non-OECD 1.3 mb/d.
Crude and Refined Product Trade
In In December, refinery margins weakened in the US Gulf Coast and Singapore, with most products facing downward pressure due to ample supply. However, jet/kerosene in the USGC and gasoline (92) in Singapore showed some resilience. In Rotterdam, margins improved further thanks to stronger travel activity during the holiday season, with support coming from gasoline, gasoil, and 1.0% sulphur fuel oil. Global refinery intake increased by 1.1 mb/d month-on-month, reaching around 82.2 mb/d in December, up by about 100 tb/d compared with the same month last year.
In December, US crude imports dipped month-on-month but remained around 6.5 mb/d, while crude exports held near 4 mb/d, and product imports and exports stood at 1.7 mb/d and 7.01 mb/d, respectively. Preliminary data for OECD Europe show a decline in crude imports both month-on-month and year-on-year, although product exports rose due to higher flows to North America. Japan’s November crude imports climbed 11% month-on-month, supported by a 12% increase in product imports fueled by naphtha, LPG, and kerosene. China’s crude imports reached a 13-month high at 11.8 mb/d, even as product imports dropped to a nine-month low and product exports hit a five-month high. India’s crude imports were steady at 4.7 mb/d, up 3% year-on-year, while product exports rebounded by nearly 9% and product imports edged up by 3%.
Supply and Demand Balance: Declining Inventories
Preliminary November 2024 data shows OECD commercial oil stocks decreased by 8.4 mb month-on-month to 2,770 mb, which is 171 mb below the 2015–2019 average. Crude stocks, at 1,313 mb, were 137 mb under the five-year average, while product stocks stood at 1,457 mb, 34 mb below the same benchmark. Despite these declines, OECD commercial stocks in terms of days of forward cover edged up by 0.1 day to 60.9 days, still 1.3 days below the 2015–2019 average.
In terms of days of forward cover, OECD commercial stocks rose by 0.1 day to 60.9 days, which is 1.3 days below the 2015–2019 average.
The requirement for OPEC crude in 2025 is revised down by 0.1 mb/d from the previous forecast to 42.5 mb/d, which is about 0.3 mb/d higher than the 2024 estimate. It is worth noting that the growth rates for global oil demand and non-OPEC supply in 2025 remain unchanged from last month’s forecast. For 2026, demand for OPEC crude is expected to reach 42.7 mb/d, around 0.2 mb/d more than the 2025 level.
Sources: OPEC, EIA, NYMEX
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