Global spare oil output up, but jump in consumption leads to fall in stocks

The world's spare oil production capacity outside of Iran rose slightly in the last two months, but a seasonal jump in winter-heating consumption led to drawdowns from global stocks, the US government said on Thursday in a bimonthly report.

In November and December, spare oil production capacity averaged 2.1 million barrels per day, the US Energy Information Administration said.

Though tight by historical standards, it is up from 2.0 million bpd from the previous two months, said the report, which was the latest in a series required by last year's Iran sanctions law.

The US Congress passed sanctions in 2011 that require global importers to buy less Iranian crude or risk being cut off from the US financial system. The European Union also banned imports of Iranian crude.

The sanctions are aimed at pressuring Iran over its nuclear programme, which Tehran has said is only for civilian purposes.

A jump in winter fuel consumption led to a 1.4-million bpd draw in world crude oil inventories, the EIA said. Most of that came from US inventories, which fell by about 0.5 million bpd in November and a further 0.6 million bpd in December.

Global liquid fuels production dipped slightly during the past 60 days, the report said. But production is still higher than it was a year ago — mostly because of the US energy boom.

During November-December, US production was up about 5% from a year ago, at 11.4 million barrels per day versus 10.8 million bpd, the eia report showed.

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