The new OPEC Reference Basket of Crudes (ORB) is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Oriente (Ecuador), Minas (Indonesia), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Qatar Marine (Qatar), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela).
Meanwhile, Market Watch reports that crude-oil prices headed lower on Thursday, suppressed by worries of an expanding supply glut after the world’s oil cartel warned that demand growth could slow.
On the New York Mercantile Exchange CLK6, -2.06% , light, sweet crude futures for delivery in May traded at $41.22 a barrel, down $0.54, or 1.3% in the Globex electronic session. June Brent crude LCOM6, -1.79% on London’s ICE Futures exchange fell $0.63, or 1.4%, to $43.55 a barrel.
In its closely watched monthly report, the Organization of the Petroleum Exporting Countries cut its forecast for 2016 oil-demand growth by 50,000 barrels a day. Demand for the commodity will now rise by 1.20 million barrels a day to 94.18 million barrels a day, according to its projections.
The downgrade, though small, is underpinned by slower economic momentum in Latin America and uncertainties in China’s growth, OPEC said.
“There is great uncertainty as to whether weakening economic activity in Latin America and signals of a slowdown in China will be reflected in oil-demand data, especially for China,” the organization said.
China’s exports unexpectedly rose 11.5% in March from the previous year, while imports declined 7.6%, a less-than-expected drop. Crude imports rose 13% to 32.6 million tons, however, equivalent to 7.71 million barrels a day.
Much of China’s thirst for crude comes from continuing efforts to fill up strategic reserves. A growing number of private refiners, known as teapots, is also driving up imports.
“The teapots have become an indispensable part of China’s imports and they will likely get stronger as the government issues importing quotas to more of them,” said Li Li, a research director with ICIS China.
An oversupply of crude has sunk prices for nearly two years and the latest expansion in U.S. crude stocks have stoked fears the rout might last longer.
U.S. crude inventories grew 6.6 million barrels in the week ended April 8, surpassing the expected 1.8 million barrel increase. The latest addition brought commercial stockpiles to a new high of more than 536 million barrels. However, production fell below 9 million barrels a day for the first time since September 2014.
“We think inventories are a key measure of the current weak fundamental balance in the market that the traders ignore at their financial peril,” said Tim Evans, a Citi Futures analyst.
All eyes will be on the Doha meeting on Sunday in which key producers are set to discuss a possible production freeze. There is also speculation the group will delay the freeze for Iran until its output reaches pre-sanction levels.
Market views on the issue have been mixed. Some say a freeze at the recent level will allow demand to catch up. Others argue it will hardly chip away at the glut and that oil prices need to stay lower for longer to weed out weaker competitors.
“The higher prices go before Sunday, the bigger the downside risk becomes if the outcome is in some way disappointing,” said Michael Wittner, chief oil analyst at Société Générale.
Nymex reformulated gasoline blendstock for May RBK6, -0.88% — the benchmark gasoline contract — fell 85.00001 points to $1.5210 a gallon, while May diesel traded at $1.2591, 65 points lower.
ICE gasoil for May changed hands at $372.75 a metric ton, down $4.25 from Wednesday’s settlement.