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 a rise of $0.83/b, m-o-m, averaging $62.79/b. The Brent–WTI front-month spread increased 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. Speculative sentiment turned bullish, with hedge funds and other money managers sharply increasing their net long positions.

World Economy & Macroeconomic Backdrop

The global economic growth forecasts remain at 3.1% for 2026 and 3.2% for 2027. The US economic growth forecast has been slightly revised up to 2.2% for 2026, while remaining at 2.0% for 2027. In the Eurozone, growth forecasts are steady at 1.2% for both years. Japan's growth is projected at 0.9% for both years, while China maintains a forecast of 4.5%. India is expected to grow at 6.6% in 2026 and 6.5% in 2027. Brazil's growth forecasts remain at 2.0% for 2026 and 2.2% for 2027, while Russia's forecasts are at 1.3% for 2026 and 1.5% for 2027.

Trade normalization and monetary policy impacts continue to shape the global economic landscape, influencing oil demand dynamics.

World Oil Demand Trends

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

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

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 expected to grow by 0.1 mb/d in both years.

In January, crude oil production by DoC countries decreased by 439 tb/d, m-o-m, averaging about 42.45 mb/d, indicating a tightening supply environment.

Product Markets & Refining Operations

In January, refining margins declined across all reported trading hubs due to stronger feedstock prices and seasonal demand pressures. The US Gulf Coast experienced losses primarily from the bottom section of the barrel, while Rotterdam saw declines in all key product margins, particularly gasoline. In Singapore, the decline was driven by elevated gasoline and jet/kerosene supplies.

Tanker Market & Freight Dynamics

Dirty tanker spot freight rates had a strong start in January, supported by weather disruptions and geopolitical uncertainties. VLCC spot freight rates surged, particularly on the Middle East-to-East route, which reached a decade-high increase of 64% y-o-y. Suezmax rates also rose amid weather disruptions, while Aframax rates experienced a strong performance, reaching a 10-year high for the month.

In the clean tanker market, rates on the Middle East-to-East route increased by 17%, m-o-m, reflecting strong demand dynamics.

Crude & Refined Products Trade Flows

US crude imports averaged 6.3 mb/d in January, consistent with the five-year average, while exports rose by almost 0.2 mb/d to 4.2 mb/d. In Japan, crude imports surged to just under 3 mb/d, the highest since March 2020. China's crude imports reached a record high of 13.2 mb/d in December, while India's crude imports remained elevated at 5.1 mb/d.

Product exports from the US averaged 7.0 mb/d, down from previous months, while Japan's product imports reached a four-month high, driven by winter fuel demand.

Commercial Stock Movements

Preliminary December 2025 data indicate that OECD commercial oil inventories rose by 6.5 mb, m-o-m, to 2,845 mb. Crude stocks fell by 2.1 mb, while product stocks increased by 8.6 mb. OECD crude oil commercial stocks stood at 1,363 mb, which is 75.5 mb higher y-o-y.

In terms of days of forward cover, OECD commercial stocks rose by 0.7 days, m-o-m, to 62.8 days, indicating a stable supply environment.

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 is projected at 43.6 mb/d, also reflecting a 0.6 mb/d increase.

The analysis indicates a supply-demand gap for DoC crude, with a requirement of 43.0 mb/d in 2026 against a non-DoC supply of 63.5 mb/d. This gap highlights the need for strategic production decisions moving forward to ensure market stability.