Total Developing Country (DCs) oil production is projected to grow by 0.24 mb/d to average 12.89 mb/d in 2012, indicating a downward revision of 35 tb/d from last month. Most of the historical revisions basically offset each other, while changes to the forecast for 2012 led to the downward revision. The Middle East supply outlook saw a marginal downward revision, while the majority of the revision came from Africa’s supply outlook. The DC supply forecast indicates strong growth from Other Asia and Latin America, while Africa and the Middle East are expected to decline. Latin America remains the region with the highest expected growth in 2012 among all the non-OPEC regions. DCs’ share of non-OPEC supply is seen to remain steady for the year, as per the forecast, at 24%, yet this group’s contribution to non-OPEC supply growth is seen higher than that of the OECD or the FSU.
The risk associated with the DC supply forecast remains on the high side, given the various political issues connected with some of the producers in the group, in addition to other technical, environmental and weather-related factors. DC supply growth in 2012 is expected to be gradual throughout the year. On a quarterly basis, total oil supply in DCs is expected to average 12.80 mb/d, 12.87 mb/d, 12.94 mb/d and 12.97 mb/d respectively. During the fourth quarter of 2011, DC supply declined by 50 tb/d, compared with the same period of 2010, as per the preliminary data.
Other Asia’s oil supply is estimated to increase by 60 tb/d and average 3.67 mb/d in 2012, unchanged from the previous MOMR. Despite the steady state, there were a few revisions that offset each other. Growth in 2012 is expected to be supported by India and Vietnam, while Indonesia and Malaysia’s oil supply is expected to encounter minor declines. Vietnam’s oil supply is projected to increase by 40 tb/d in 2012 to average 0.39 mb/d, flat from the previous month. The expected increase is supported by projects, such as Rang Dong, Te Giac Trang, Su Tu Trang and Lan Do. India’s oil production is anticipated to increase by 20 tb/d to average 0.91 mb/d. This growth is supported by the Bhagyam project, part of the Mangala development in Rajasthan. The Bhagyam field started up in January, after delays in receiving the green light from the authorities; it is expected to reach peak capacity of 40 tb/d by the end of the year. Thailand’s oil supply is anticipated to remain steady and average 0.33 mb/d, unchanged from the previous evaluation. On a quarterly basis, Other Asia’s supply is seen to average 3.66 mb/d, 3.66 mb/d, 3.67 mb/d and 3.68 mb/d respectively.
Malaysia’s oil supply is forecast to experience a minor decline of 10 tb/d in 2012 to average 0.63 mb/d, flat from the previous MOMR. The anticipated drop is projected on the back of declines at mature producing areas and limited new developments. The start-up of the Sepat offshore oil field, with a capacity of 20 tb/d, will provide support to the country’s output, in addition to the completion of maintenance at the Sabah project.
Indonesia’s oil supply is expected to average 0.91 mb/d in 2012, a minor decline of 10 tb/d, representing a minor upward revision of 10 tb/d from the previous MOMR. The upward revision occurred on the back of reports that Indonesia’s major producer will drill 380 new wells and rework 211 existing wells, which will add around 15 tb/d in 2012. Furthermore, the decree by the Indonesian President to authorities to take steps to boost output to 1.01 mb/d by 2014 further supported the revision.