Crude Oil Radar

OPEC Market Analysis

Crude Oil Price Movements

In January, the OPEC Reference Basket (ORB) value rose by $0.61/b, month-on-month (m-o-m), to average $62.31/b. The ICE Brent front-month contract increased by $3.10/b, m-o-m, to average $64.73/b, while the NYMEX WTI front-month contract rose by $2.39/b, m-o-m, to average $60.26/b. The GME Oman front-month contract also saw an increase of $0.83/b, m-o-m, to average $62.79/b. The Brent–WTI front-month spread rose by $0.71/b, m-o-m, to average $4.47/b.

The forward curves of all major crude benchmarks strengthened, with the front end of the curves for both ICE Brent and NYMEX WTI moving into stronger backwardation. This shift was supported by oil supply outages, easing selling pressure from speculators, and robust physical market fundamentals. The forward curve for GME Oman remained relatively unchanged, m-o-m. Speculative sentiment turned bullish, with hedge funds and other money managers significantly increasing their net long positions.

World Economy & Macroeconomic Backdrop

The global economic growth forecasts remain steady at 3.1% for 2026 and 3.2% for 2027. Key economic growth outlooks include:

• US: Revised slightly up to 2.2% for 2026, steady at 2% for 2027
• Eurozone: Stable at 1.2% for both 2026 and 2027
• Japan: Constant at 0.9% for both years
• China: Maintained at 4.5% for both 2026 and 2027
• India: Forecast at 6.6% for 2026 and 6.5% for 2027
• Brazil: Remains at 2.0% for 2026 and 2.2% for 2027
• Russia: Unchanged at 1.3% for 2026 and 1.5% for 2027

Trade normalization and monetary policy adjustments are expected to influence these growth trajectories.

World Oil Demand Trends

The global oil demand growth forecast for 2026 remains at 1.4 mb/d, y-o-y, with the OECD projected to increase by 0.15 mb/d and non-OECD expected to grow by approximately 1.2 mb/d. In 2027, global oil demand is forecast to grow by about 1.3 mb/d, y-o-y, with the OECD growing by 0.1 mb/d and non-OECD increasing by about 1.2 mb/d.

Key demand drivers include economic growth in emerging markets, while constraints may arise from shifts in energy policies and efficiency improvements.

World Oil Supply Analysis

Non-DoC liquids production is forecast to grow by about 0.6 mb/d, y-o-y, in both 2026 and 2027, primarily driven by Brazil, Canada, the US, and Argentina. Natural gas liquids (NGLs) and non-conventional liquids from DoC countries are projected to grow by 0.1 mb/d in both years, reaching averages of 8.8 mb/d in 2026 and 8.9 mb/d in 2027.

In January, crude oil production by DoC countries decreased by 439 tb/d, m-o-m, to average about 42.45 mb/d, according to available secondary sources.

Product Markets & Refining Operations

In January, refining margins declined across all reported trading hubs due to stronger feedstock prices and seasonal demand pressures. Notable trends include:

• US Gulf Coast: Losses primarily from the bottom section of the barrel, with increased heavy crude supplies affecting fuel oil and gasoil crack spreads.
• Rotterdam: Key product margins declined, particularly gasoline.
• Singapore: Decline driven by elevated gasoline and jet/kerosene supplies.

Tanker Market & Freight Dynamics

Dirty tanker spot freight rates experienced a strong start in January, driven by weather disruptions and geopolitical uncertainties. Key developments include:

• VLCC spot freight rates reached the highest levels for the month in at least a decade, up by 64%, y-o-y.
• Suezmax rates increased by 12%, m-o-m, due to weather disruptions and demand from European refiners.
• Aframax spot freight rates rose by 10%, m-o-m, achieving a 10-year high.
• In the clean tanker market, rates on the Middle East-to-East route increased by 17%, m-o-m.

Crude & Refined Products Trade Flows

In January, US crude imports averaged 6.3 mb/d, consistent with the five-year average, while crude exports rose by almost 0.2 mb/d, m-o-m, to average 4.2 mb/d. Key trade patterns include:

• OECD Europe: Crude imports declined, driven by lower flows from Kazakhstan.
• Japan: Crude imports surged to just under 3 mb/d, the highest since March 2020.
• China: Crude imports reached a record high of 13.2 mb/d in December.
• India: Crude imports remained elevated at 5.1 mb/d despite a slight decline, m-o-m.

Commercial Stock Movements

Preliminary December 2025 data indicate that OECD commercial oil inventories rose by 6.5 mb, m-o-m, to reach 2,845 mb. This level is 89.9 mb higher, y-o-y, and 44.1 mb above the latest five-year average. However, it remains 81.0 mb below the 2015–2019 average. Key points include:

• Crude stocks fell by 2.1 mb, while product stocks increased by 8.6 mb, m-o-m.
• OECD crude oil commercial stocks stood at 1,363 mb, 75.5 mb higher, y-o-y.
• Days of forward cover rose by 0.7 days, m-o-m, to 62.8 days.

Supply-Demand Balance & Market Outlook

The demand for DoC crude in 2026 remains at 43.0 mb/d, which is about 0.6 mb/d higher than that of 2025. The demand for DoC crude in 2027 also remains at 43.6 mb/d, reflecting similar growth. The following table summarizes the supply-demand balance:

The supply-demand gap analysis indicates that with world demand at 106.5 mb/d in 2026 and non-DoC supply at 63.5 mb/d, the DoC requirement stands at 43.0 mb/d. This gap highlights the strategic importance of production decisions moving forward, as the market seeks to balance supply with increasing demand.