OREANDA-NEWS. Opec left its major supply and demand forecasts for 2016 largely unchanged in today's Monthly Oil Market Report (MOMR), but warned that "current negative factors seem to outweigh positive ones and possibly imply downward revisions in oil demand growth, should existing signs persist going forward".

It cited weakening economic activity in Latin America and China as one concern, albeit counterbalanced by stronger prospects for India and South Korea. It is too early to judge the impact of subsidy removal in a number of Middle East producer countries, it said. It also noted "a high degree of uncertainty" over the effect of sharp changes in oil prices, although these were a boon for road transport fuel demand in the US and Europe last year.

On 17 April, most Opec members and some non-Opec producer countries will meet in Doha to consider proposals to freeze production at January levels in a bid to stabilise oil prices.

The MOMR downwardly revised its 2016 demand growth forecast by 50,000 b/d to 1.2mn b/d, putting demand at 94.18mn b/d. But it also pared its outlook for non-Opec production to 56.39mn b/d, a reduction of 30,000 b/d, citing lower expectations from onshore China. It said non-Opec output in 2016 is subject to a number of uncertainties but added that the decline has been less than expected because of lower production costs in the US, hedging, and the decision by some producers to incur losses rather than cease output.

The report leaves its call on Opec crude in 2016 almost unchanged at 31.5mn b/d.

Argus puts Opec production in March — excluding Indonesia — at 31.6mn b/d. Data provided to the Opec secretariat by member governments put production in the month at some 33.54mn b/d, if the Argus number of 340,000 b/d is used for Libya, which did not provide a figure for the report. That compares with some 33.36mn b/d in February. The UAE production number rose by almost 130,000 b/d after maintenance depressed the February figure. Iraq reported a 95,000 b/d rise as the Kirkuk-Ceyhan pipeline resumed operations part way through the month. But the March figure remains shy of the 4.78mn b/d declared for January, which is the figure the government wishes to highlight going into the Doha meeting. Nigeria declared a fall in output of 67,500 b/d while Iran said its output had only risen by 15,000 b/d on the month to 3.4mn b/d.