Abstract
The latest Singapore Oil & Gas Report from BMI forecasts that the country will
account for 3.70% of
Asia Pacific regional oil demand by 2013, while not
contributing to 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. Singapore’s share of gas consumption in
2008 was 2.00%, and
market share is expected to rise to 2.10% by 2013.
There is no gas production in Singapore.
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.
Singapore’s real GDP is now forecast by BMI to fall by 7.2%
in 2009, compared with growth of 1.1% in
2008. We expect 1.3% growth in
2010, 2.3% in 2011, 3.6% in 2012, followed by 3.8% in 2013. There is
no
domestic oil or gas production but there is an active downstream segment, with
extensive international
oil company (IOC) involvement in refining and
petrochemicals. Oil consumption beyond 2009 is forecast
to increase by
around 3% per annum to 2013, implying demand of 1.06mn b/d by the end of the
forecast
period. Gas demand and imports are forecast to increase from
9.2bcm in 2008 to 11.8bcm by 2013.
Between 2008 and 2018, we are
forecasting an increase in Singapore’s domestic oil consumption from
958,000b/d to 1.22mn b/d (+27.7%), with the island’s refining capacity
rising from 1.26mn b/d to 1.65mn
b/d. Gas demand is expected to rise from
around 9bcm in 2008 to a possible 17bcm by 2018, driven by
power
generation requirements. Liquefied natural gas (LNG) imports are expected to
commence in 2013
and reach 4bcm per annum through the initial import
terminal. Details of BMI’s 10-year forecasts can be
found later in
this report, which provides regional and country-specific projections.
Singapore still ranks equal 11th (alongside Hong Kong) in BMI’s updated
Upstream Business
Environment rating, thanks to a virtual absence of
hydrocarbon resources. The score reflects the limited
involvement of the
government in upstream oil activities and an exceptionally healthy country
risk
profile, which partly offset the lack of reserves and output growth
potential. The country sits ahead of
South Korea and well clear of
bottom-placed Taiwan in the upstream league table. The country now ranks
fifth in BMI’s updated Downstream Business Environment rating,
reflecting its relatively high level of oil
consumption, increasing gas
demand, established modern refining capability, fuels export capability and
a
relatively low level of retail site intensity. It is just one point
clear of South Korea, but should be able to
retain its lead.
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