July oil demand growth in Iraq was broadly flat, with total product consumption back below the 0.7 mb/d mark at 0.67 mb/d. This data represents the slowest pace of growth so far in 2017. Product categories saw mixed performance, while demand for transportation fuels – jet fuel, gasoline and diesel oil, along with fuel oil – increased over the course of the month. Direct crude for power generation and naphtha lost ground, dragging overall consumption lower.
Oil demand growth in the Middle East in 2017 is foreseen to rise over 2016 levels, as economic momentum gains pace y-o-y, while for 2018 the level of oil demand growth is anticipated to moderate slightly from 2017 levels. Oil demand in Saudi Arabia is expected to fluctuate during the reminder of the current year as a result of consumer reactions to economic reform policies in the country. Demand from Iraq is projected to contribute positively to oil demand growth in the region, along with IR Iran, the UAE and Kuwait, which will provide support to a lesser extent.
Middle East oil demand for 2017 is projected to increase by 0.11 mb/d, while oil demand in 2018 is anticipated to rise by 0.10 mb/d.