Market and product

The decrease in oil production in the US and China may be the main factor to rebalance the global crude market, according to Standard Chartered analysts.

"China cannot rebalance the global oil market on its own, but China and the US together are doing most of this work," the analysts were cited by Bloomberg. "The swing from growth to decline in domestic output means that China’s net pull on the oil market will likely increase this year, despite slower demand growth."

According to their forecasts, output in China, the world’s fifth-largest oil producer, would reach an average of 4.05 million barrels a day in 2016, nearly 253,000 barrels more than in 2015.

The output of PetroChina Co., China’s largest oil and gas company, is expected to decline in 2016 by 4.9 percent, to 924.7 million barrels a day. CNOOC Ltd. is also expected to decrease output this year – by 5.2 percent, to 470 million barrels a day. In January, Sinopec announced the first drop in oil and gas output in 16 years.

At the same time, China’s crude imports rose in the first quarter of 2016, to a record of 7.34 million barrels a day, 13 percent higher against the same period in 2015.

Furthermore, output figures are changing in the US. For example, over the past 14 weeks oil output in the US has dropped to 8.9 million barrels a day. In April, the outlook for the US in 2016 was downgraded to 8.6 million barrels a day.