Abstract
The latest Philippines Oil & Gas Report from BMI forecasts that the country
will account for 1.12% of
Asia Pacific regional oil demand by 2013, while
providing 0.80% of supply. Asia Pacific regional oil use
of 21.40mn
barrels per day (b/d) in 2001 reached 25.67mn b/d in 2008. It should average
24.83mn b/d in
2009, then rise to around 28.51mn b/d by 2013. Regional oil
production was just under 8.41mn b/d in
2001, and averaged 8.45mn b/d in
2008. It is set to increase to 8.75mn b/d by 2013. In 2001 the region
was
importing an average 12.99mn b/d. This total had risen to an estimated 17.22mn
b/d in 2008, and is
forecast to reach 19.76mn b/d by 2013.
In terms of
natural gas, in 2008 the region consumed 459bn cubic metres (bcm) and demand
of 562bcm is
targeted for 2013. Production of 356bcm in 2008 should reach
488bcm in 2013, but implies net imports
easing from an estimated 102bcm
per annum in 2008 to 74bcm in 2013. This is in spite of many Asian
gas
producers being major exporters. The Philippines’ share of gas
consumption in 2008 was 0.76%,
while its share of production is put at
0.98%. By 2013, its share of gas consumption is forecast to be
0.91%, with
the country accounting for 1.04% of supply.
For 2009 as a whole, we are
now assuming an average OPEC basket price of US$55.00 per barrel (bbl), a
41.5% decline year-on-year (y-o-y). This represents an upgrade from the US$52
forecast we have stuck
with during the past three quarters. Our OPEC
basket assumption delivers likely Brent, WTI, Urals and
Dubai prices of
US$56.30, US$57.50, US$55.60 and US$55.60/bbl respectively. For 2010, we
expect to
see a recovery to US$60.00/bbl for the OPEC price (up from our
previous forecast of US$58), gaining
further ground to US$65.00 in 2011
and to US$70.00/bbl in 2012. Our post-2010 forecasts are unchanged
and we
are continuing to use a long-term price assumption of US$70.00 for
2013-2018.
In 2009, BMI is now assuming a global average gasoline price of
US$62.12/bbl, with the fuel having
peaked in June. The overall y-o-y fall
in 2009 gasoline prices is put at 40.0%. The BMI gasoil forecast is
for an
average price of US$68.62/bbl, assuming a monthly high of US$92.49/bbl in
December. The fullyear
outturn represents a 43.4% fall from the 2008
level. The annual jet price level for 2009 is forecast to
be US$65.17/bbl.
This compares with US$124.95/bbl in 2008. The 2009 average naphtha price is
put by
BMI at US$49.06/bbl, down 43.9% from the previous year’s
level
The Philippines’ real GDP growth is now forecast by BMI at
0.9% for 2009, down from 3.8% in 2008.
We are assuming 2.4% growth in
2010, 4.7% in 2011, followed by 4.4% in 2012, and 4.3% in 2013.
There is
international oil company (IOC) and national involvement in domestic upstream
activities,
leading to substantial gas output growth and some modest
liquids expansion. We are assuming oil and gas
liquids production of no
more than 70,000b/d by 2012/2013, with the country pumping an estimated
60,000b/d in 2009. Beyond 2009, consumption is forecast to increase by up to
3% per annum to 2013,
implying end-period demand of 319,000b/d. The import
requirement would therefore be about
249,000b/d by 2013. Gas demand is
forecast to rise from 3.5bcm in 2008 to 5.1bcm by 2013, with
imports
required beyond the end of the forecast period.
Between 2008 and 2018, we
are forecasting a reduction in Philippines oil production of 5.0%, with
crude
volumes peaking at 70,000b/d in 2012/2013 before falling steadily to
54,000b/d in 2018. Oil consumption
between 2008 and 2018 is set to
increase by 26.0%, with growth slowing to an assumed 3.5% per annum
towards the end of the period and the country using 363,000b/d by 2018. Gas
production is expected to
rise from around 3.5bcm in 2008 to a possible
7.0bcm by 2018. With demand growth of 125.7%, this
requires up to 0.9bcm
of imports. Details of BMI’s 10-year forecasts can be found later in
this report,
which provides regional and country-specific projections.
The Philippines now ranks sixth in BMI’s updated Upstream Business
Environment rating, reflecting a
reasonable resource position and a
better-than-average output growth outlook. The country sits just
behind
Malaysia. The country now ranks equal seventh with Vietnam in our Downstream
Business
Environment rating, reflecting its modest refinery capacity
expansion plans, reasonable oil and gas
demand growth outlook and
relatively low level of retail site intensity.
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