World oil demand for 2017 was unchanged from the previous month’s report. Total world oil demand growth
is expected at 1.27 mb/d, with total consumption at around 96.4 mb/d. In 2018, world oil demand is projected
to grow at a similar pace to the current year, rising by 1.26 mb/d to average 97.6 mb/d. Non-OECD countries
are projected to lead oil demand growth with 1.06 mb/d, while OECD nations are anticipated to increase by
Supported by the continuing lower oil price environment and in line with its growing economy, the latest
available US monthly oil demand data for April 2017 show a growth of approximately 0.3 mb/d y-o-y. For
the first four months of the year, oil requirements are higher by around 0.1 mb/d compared to the same
period in 2016.
The key characteristics for the first four months of 2017 are strong and rising demand for LPG,
jet/kerosene, naphtha and diesel, and at the same time declining demand for gasoline and flat y-o-y residual
fuel oil requirements. Weak gasoline demand in April 2017, as well as for the y-t-d 2017, is in line with
declining car sales following a very strong 2016. Residual fuel oil requirements fell mainly as a result of
substitution with other primary commodities.
Preliminary weekly data for May and June suggests a continuation of the increase in oil demand y-o-y, with
the product consumption pattern observed for the first four months of 2017 largely unchanged. It should be
noted, however, that gasoline demand appears to be stronger in May, while diesel oil demand seems to be
bullish for both May and June.
The risks for 2017 US oil demand are most likely skewed to the upside, compared to previous months. As it
was the case for 2016, the forecasts for 2017 are mainly dependent on US economic growth and oil price
levels, although the impact of the latter are most likely to be lower than in recent years. An additional factor
that could further enhance US oil demand in 2017 is the expansion of the petrochemical industry. However,
there remain some downside risks, such as potential fuel substitution with other commodities and continuing
fuel efficiencies in the road transportation sector.
Mexican oil demand in May 2017 remained flat y-o-y for the second month in a row. Residual fuel oil and jet
kerosene requirements grew strongly, but this was offset by shrinking demand for LPG, naphtha and
gasoline. Gas oil/diesel oil demand remained flat y-o-y. Mexican oil demand for the whole of 2017 is
expected to decline slightly y-o-y, although positive economic growth expectations could see oil demand
growth push, marginally higher.
In Canada, rising oil demand in the transportation sector and industrial fuel requirements, in combination
with declining requirements for all other main petroleum product categories, have led to an overall 1.3% drop
in Canadian oil demand for the first four months of 2017. Projections for Canadian oil demand in 2017
remain unchanged from those in previous months, with oil requirements during 2017 slightly lower than those
in 2016. Transportation fuels are expected to account for the bulk of the growth, with risks being balanced
towards the upside and downside.
In 2016, OECD Americas oil demand grew by 0.14 mb/d, compared to 2015. In 2017, OECD Americas oil
demand is projected to be higher by 0.15 mb/d, compared to 2016.
OECD Europe oil demand in April 2017 declined by almost 0.3 mb/d y-o-y. This follows a healthy 1Q17, as
well as generally strong demand in both 2015 and 2016. For April 2017, increases were only witnessed in
naphtha and automotive diesel for the industrial and road transportation sectors respectively. This growth
was more than offset by declines in light and middle industrial fuels, notably LPG, and diesel oil, while
jet/kerosene demand also fell during the same month y-o-y.
Early indications for May 2017 show continuing oil demand losses for the Big European 4 as a whole. Oil
demand in Germany, France and the UK shrank, although requirements in Italy increased y-o-y. It is also
worth noting that in May 2017, auto sales in Europe rose strongly, by almost 8% y-o-y, with all major auto
markets being in the positive, except for the UK that saw a decline. Germany (13%) and Spain (11%)
showed the largest gains, followed by France (9%) and Italy (8%). Y-t-d auto sales grew by a robust 5% in
the region. The general expectations for the region’s oil demand during the remainder of 2017 offer some
downside risks. This is the result of uncertainties relating to the region’s traditional oil demand structure, which is perhaps the greatest uncertainty in all the main demand regions. On the one hand, the projected
improvements in the economy are indicating an increase in oil requirements, but on the other, the high
historical baseline, the potential weaker impact of lower oil prices on road transportation fuels and high
taxation on oil usage pose considerable risks to the downside. Other factors that may cap oil demand in the
region include fuel substitution and efficiencies.
European oil demand oil grew strongly in 2016, increasing by 0.31 mb/d. In 2017, the region’s oil demand is
projected to increase slightly y-o-y by 0.10 mb/d.
OECD Asia Pacific
In Japan, preliminary oil demand data for May 2017 indicates the first monthly y-o-y slightly increase so far
this year. The gains originated in diesel, naphtha, as well as LPG, while decreasing volumes were once
again largely due to direct fuel and crude usage for electricity generation, as a result of the ongoing
substitution with other primary commodities. May 2017 gasoline demand remained flat y-o-y, while diesel
requirements were bullish in line with rising Japanese auto sales during the same month. Drops in demand
of all other product categories were observed, resulting in overall oil demand growth in May 2017 of
0.03 mb/d y-o-y.
As far as the outlook for Japanese oil demand in 2017, current estimations remain roughly unchanged from
last month’s forecast, with risks generally skewed to the downside. Oil demand projections for 2017 take into consideration that more nuclear plants are expected to resume operations, although some improvements in
the country’s economy mean that the expected slow contraction in oil demand requirements is only around
In South Korea, April 2017 data showed a strong oil demand increase of 0.1 mb/d, y-o-y, with the bulk of
growth in industrial fuels, particularly for the petrochemical industry. The outlook for South Korean oil
demand for the remainder of 2017 remains strong. This is unchanged from last month’s projections.
OECD Asia Pacific oil demand expanded marginally by 0.03 mb/d in 2016, while 2017 oil demand is
expected to decline by 0.01 mb/d, y-o-y.
In May 2017, Indian oil demand growth grew by a firm 0.22 tb/d. This is a growth of around 5%, compared to
the same period in 2016, with total consumption standing above 4.3 mb/d. From the product point of view, diesel oil, gasoline and LPG were the products that witnessed the greatest expansion during the month,
while fuel oil saw a drop.
Diesel oil requirements increased strongly in May, with product higher by a firm 0.12 mb/d compared to the
same month of 2016. Total diesel oil consumption was at a record of 1.68 mb/d. Support stemmed from
several factors, specifically healthy manufacturing and road construction activities, as well as the extreme hot
conditions in parts of the country that limited hydropower generation and allowed for additional usage of
diesel oil power generators. Gasoline demand increased by a firm 92 tb/d, or close to 15% y-o-y. According
to the May 2017 industry sales review of the Petroleum Planning & Analysis Cell vehicle sales increased by
around 9% y-o-y. Passenger car sales added around 5% y-o-y, while growth in Sport Utility Vehicles (SUV)
recorded a healthy 19% rise y-o-y, which is considered the strongest May performance on record. Total twowheeler
sales rose just shy of 12% y-o-y, to reach to 1.69 million units. This was largely driven by scooters,
which rose by 24% y-o-y. Motorcycle sales were higher by around 8% y-o-y.
LPG demand saw an increase of 80 tb/d, or 12% y-o-y, which was broadly the result of the government’s
expansion of LPG outlets to reach to wider end-users. Fuel oil was flat y-o-y, despite healthy bunkering
activities. Jet/kerosene dropped by 36 tb/d, the eighth consecutive monthly fall, with total consumption at
0.30 mb/d. This is mainly due to kerosene usage in the residential sector being replaced by LPG. However,
jet fuel kept growing in line with the higher y-o-y air travel activities.
In Indonesia, the latest available April 2017 data shows rising demand for LPG, naphtha and diesel oil,
which increased rose by around 6%, 4% and 3% y-o-y, respectively. Total consumption reached 1.67 mb/d,
an uptick of 28 tb/d, or 2% y-o-y.
In Thailand, oil demand in April 2017 declined by a 45 tb/d, or 3% y-o-y compared to the same month in
2016.The bulk of the declines were seen in fuel oil, naphtha and jet/kerosene. LPG, gasoline and diesel oil,
on the other hand, grew marginally.
The uncertainties for 2017 oil demand in Other Asia are currently balanced. The major upside potential
relates to further economic improvement in the largest oil consumer in the region, as well as the general
economic performance of other countries in the region.
Other Asia’s oil demand grew by 0.57 mb/d in 2016, and expected to increase at the rate of 0.33 mb/d in
In Brazil, the latest available data for May 2017 for imply oil demand growth of 1.4% y-o-y. The bulk of the
gains were for gasoline and diesel oil requirements, while demand for LPG and naphtha remained flat y-o-y.
On the other hand, ethanol demand fell sharply, which partly offset the other increases. May 2017 marked
the third month in which indicators pointed towards a possible recovery for the remainder of 2017,
particularly in terms of oil usage in the transportation and industrial sectors. Expectations for 2017 Brazilian
oil demand remain unchanged from last month, with oil demand growth dependent on the country’s
economic recovery during the remainder of the year.
In Argentina, oil demand in April 2017 fell slightly y-o-y. As for March 2017, gains for lighter products and
middle distillates, particularly gasoline and jet/kerosene, were largely offset by declining demand for residual
The latest Ecuadorian oil demand data for April 2017 show declines y-o-y. This is dominated by shrinking
residual fuel oil demand. However, demand for gasoline grew strongly, while requirements for all other
product categories remained flat.
Latin America’s oil demand fell by 0.09 mb/d in 2016. During 2017, Latin American oil demand is projected
to increase by 0.05 mb/d.
In Saudi Arabia, oil demand growth figures for May returned to the declining trend seen in the first three
months of the year. Oil requirements fell by 0.10 mb/d, or 4%, compared to the same month in 2016. Within
the products, however, the performance rather mixed, with firm growth for gasoline, fuel oil and LPG
outweighed by slower than expected growth in middle distillates and direct crude for the purpose of burning.
The steepest decline was for diesel oil in the transportation and industrial sector, shedding 0.13 mb/d, or
around 17% y-o-y. Crude oil for direct burning in power generators declined by 56 tb/d, or 9 % y-o-y. The
drop in usage of these products was a result of a slower than expected momentum in manufacturing
activities, a less than expected growth in trading activities, a fall in truck movements and lower weather
temperatures, compared to May 2016, which led to a lower usage of air conditioning. Furthermore,
jet/kerosene also declined by 1% y-o-y, as a result of fewer air travel activities ahead of the summer holiday.
Gasoline, on the other hand, grew by a solid 55 tb/d, or 10% y-o-y, due to an increase in the miles travelled
across the country. Fuel oil also added 7% y-o-y, compared to May 2016, mainly to supply new power
generation plants in the southern part of the country. On a y-t-d basis, with data till May, the overall oil
demand picture for 2017 remains unchanged, with a decline of around 13% y-o-y. Declines in diesel oil
demand, as well as a number of other product categories, outpace growth in fuel oil, gasoline, LPG and
Going forward, potential positives for oil demand projections are the upward possibilities for overall economic
performance, which is anticipated to accelerate in the 2H17, in addition to the uptick expected from the
transportation, power and industrial sectors, due to summer peak demand. The downward risks are linked to
the higher level of substitution towards natural gas, as well as the process of economic reforms that include
the partial removal of subsidies.
Solid jet/kerosene, gasoline, gas/diesel oil and LPG demand in Kuwait contributed to an overall increase in
oil requirements in May 2017.
Oil demand also grew in IR of Iran, Iraq, UAE and Qatar, with transportation fuels, notably jet fuel and
gasoline, dominating the increase in all countries.
In the Middle East, oil demand remained flat y-o-y during 2016. In 2017, oil demand is anticipated to expand
by 0.11 mb/d.
The pace of growth in Chinese oil demand in May 2017 has been lowered to approximately 3% y-o-y.
However, it remains relatively robust and in line with continuing strong economic growth, which is mainly
reflected in rising oil demand for the transportation and industrial sectors.
As in recent months and quarters, demand for LPG and naphtha grew substantially in line with healthy
growth in the petrochemical industry, as well as the road transportation sector. Furthermore, jet/kerosene
continued to be bullish supporting a flourishing aviation sector. Gasoline requirements rose 9% y-o-y, in line
with an increase in auto sales. Residual fuel oil demand rose approximately 1% y-o-y, while diesel demand
increased for the third consecutive month, as a result of usage in the transportation and industrial sectors.
The overall risk outlook is skewed to the upside, unchanged from last month. The factors pointing to the
upside are the expected economic growth, in combination with a healthy petrochemical industry, as well as
upside potentials in the transportation sector. Some downside risks pertain to fuel substitution in the
industrial sector, as wel as efficiencies and alternative vehicle penetration in the road transportation sector.
For 2016, Chinese oil demand grew by 0.31 mb/d, while oil demand in 2017 is projected to increase again
by 0.34 mb/d.
World oil demand in 2018
World oil demand growth for 2018 is estimated at 1.26 mb/d, broadly in line with the growth seen the last
five-years-average. The major assumptions accounted for in the MOMR’s 2018 oil demand outlook are:
world economic activities are projected to increase by 3.4% y-o-y; road transportation fuels – gasoline, jet
fuel and diesel oil – are anticipated to provide the bulk of the growth in 2018 propelled by steady vehicle
sales in US, China and India; and capacity additions and expansions in petrochemical sector projects are
expected to provide support to light distillate requirements, mostly in the US, as a result of the shale gas
revolution, but also in China, due to new propane dehydrogenation plants.
Conversely, it is assumed that oil demand is limited by such issues as: a higher level of substitution towards
other fuels, mostly in the OECD Asia Pacific, America and the Middle East; efficiency gains that increase
steadily in line with historical norms; the reduction of subsidies aimed at reducing oil consumption,
particularly in the Middle East; and the role of digitalization and technological development in various sectors
is also expected to cap oil demand growth in 2018.
As a result, OECD oil demand is foreseen to rise by around 0.20 mb/d. OECD Americas is projected to be
firmly in the positive, OECD Europe rising marginally, and OECD Asia Pacific declining.
Non-OECD oil demand growth is expected to be at 1.06 mb/d, with Other Asia being the major regional
contributor to growth, followed by China.
The major assumptions considered in 2018 projections for OECD America pertain to a firm growth in
economic activities that lend support to industrial and construction fuels. Expansion in the transportation
sector, including aviation, is anticipated to provide the bulk of oil demand growth in the region, mostly in the
US. In Mexico, transportation fuels are anticipated to moderate in line with recent trends, while in Canada
they are expected to increase marginally. Sizable new NGL capacities are projected to start up in the US and
this will provide solid support to light distillates in the US petrochemical sector. Assumptions restraining oil
demand growth in OECD America in 2018 include substitution with natural gas and other fuels; fuel efficiency
gains due to higher consumption per gallon; technological advancements in alternative fuels vehicles; and
the use of new car sharing applications, related to digitalization. In terms of products, growth is expected to
be led by the transportation fuels, gasoline and jet, followed by light distillates as petrochemical feedstocks.
OECD Americas oil demand in 2018 is projected to be higher by 0.19 mb/d, compared to 2017.
For OECD Europe, the major assumptions for oil demand growth in 2018 evolve around steady economic
conditions, a healthy transportation sector and stable petrochemical margins. Given this, on-road diesel is
projected to rise the most, along with petrochemical feedstocks. The industrial sector is projected to be
supported by the Big European 4 consuming countries and to a lesser extent by Turkey, Portugal, Spain and
the Netherlands. Factors that may cap oil demand in the region are fuel substitution and efficiencies in the
road transportation sector. In terms of products, diesel oil and gasoline are the products anticipated to lead
demand in 2018.
OECD Europe oil demand growth in 2018 is anticipated to slightly increasing by 30 tb/d y-o-y.
OECD Asia Pacific
The major assumptions for oil demand growth in the Asia Pacific in 2018 are mainly focused around the
following: the petrochemical sector is projected to be the fastest growing sector in the region with demand for
petrochemical feedstocks estimated to show healthy growth in both Japan and South Korea; and industrial
development and activities are projected to further support oil demand growth, mainly in South Korea.
However, these positive assumptions are anticipated to be outweighed by declining factors in a number of
sectors. These issues include: a continuous process of substitution from fossil fuels, primarily fuel oil and
direct crude burning for the purpose of power generation; governmental policies to limit oil demand
consumption; the advancement of efficiency gains across sectors, especially in the vehicle fleet; and
technological development in various sectors. In terms of products, light distillates and middle distillates are
anticipated to be in positive territory in 2018.
OECD Asia Pacific oil demand is anticipated to fall by 24 tb/d y-o-y in 2018.
Other Asia’s oil demand growth in 2018 is anticipated to continue the healthy pace exhibited in recent years,
with oil demand growth potential remaining similar to 2017. In 2018, assumptions revolve around a
continuous healthy development in the region’s overall economic picture, particularly India. Additionally,
expanding economic activities in other countries in the region, such as Indonesia, Thailand, Singapore and
the Philippines are projected to contribute positively to oil demand growth. The transportation sector is
projected to lead growth as a further expansion in the vehicle fleet supports demand. LPG in India’s
residential sector and the petrochemical sector across the region are also projected to encourage oil demand
in 2018. In contrast, fuel substitution in the power generation sector along with government policies to limit
oil consumption, most notably electric vehicle sales targets, are anticipated to dampen oil demand growth in
the region. In terms of products, light distillate, which includes LPG, naphtha and gasoline, are anticipated to
be the products leading oil demand.
Other Asia oil demand is anticipated to rise solidly in 2018, by 0.33 tb/d y-o-y.
Oil demand growth in Latin America in 2018 is envisaged to be in positive territory again. Growth is expected
to be driven by better economic projections for most countries in the region, in addition to the lower base line
for comparison. Development in various sectors, agriculture, transportation, industrial, and power are
projected to provide the major support to oil demand. As usual, Brazil is projected to by the main source of oil
demand growth in 2018 with an estimated share of more than 50%. In terms of products, diesel oil and
gasoline have the highest growth potential, helping fuel the industrial and transportation sectors.
In Latin America, oil demand growth in 2018 is foreseen to rise at a higher pace than the current year, with
growth estimated at 85 tb/d y-o-y.
In the Middle East, oil demand growth is foreseen growing positively in 2018 albeit at a marginally slower
pace from the current year. The oil demand growth will be primarily linked to assumed improvement in
overall economy of the regions, particularly in Saudi Arabia. The petrochemical sector along with
transportation sector should provide the bulk of improvement in demand, while projected partial removal of
subsides, gains in efficiency standards chiefly in the power sector and geopolitical concerns are estimated to
limit demand growth. In terms of products, transportation fuels – gasoline and diesel oil – are anticipated to
be the products leading oil demand growth.
Middle East oil demand growth in 2018 is foreseen rising at an estimated 95 tb/d, y-o-y.
In China, oil demand growth is foreseen rising firmly in 2018, roughly at a similar level of growth as in 2017
despite slightly slower economic developments. Transportation sector will continue its robustness and grow
the largest. Demand for gasoline and jet fuel oil rise as a result and provide the bulk of growth in 2018.
Petrochemical sector is estimated to continue rising as new propane dehydrogenation plants (PDH) are
expected be commissioned in 2018 providing support to LPG demand growth. Conversely, a continuation of
fuel qualities programs targeting fewer emissions, further usage of new digital applications/software
promoting vehicle/bicycle sharing and the ongoing fuel substitution with natural gas and coal are also
assumed limit demand growth in 2018.
China oil demand growth in 2018 is foreseen reaching 0.31 mb/d.