Saudi Arabia will account for 20.03 percent of Middle Eastern region oil demand by 2012, the latest “Saudi Arabia Oil & Gas Report from BMI” said on Saturday, while providing a dominant 40.71 percent of supply. The regional oil use of 8.24 mbd in 2001 rose to an estimated 10.61 mbd in 2007. It should average 10.86 mbd in 2008 and then rise to around 11.84 mbd by 2012. Regional oil production was 22.87 mbd in 2001, and in 2007 averaged an estimated 25.56 mbd. It is set to rise to 28.94 mbd by 2012. In terms of natural gas, the region in 2007 consumed an estimated 371bcm, with demand of 542bcm targeted for 2012, representing 46 percent growth. Production of an estimated 368bcm in 2007 should reach 576bcm in 2012 (+56 percent), which implies net exports rising to 34bcm by the end of the period. The report said Saudi Arabia in 2007 consumed an estimated 20.75 percent of the region's gas, with its market share forecast at 17.97 percent by 2012. It contributed an estimated 20.90 percent to 2007 regional gas production and, by 2012, will account for 16.91 percent of supply. The report estimated that in the first quarter of 2008 the OPEC basket price averaged $92.64 per barrel - up around 9 percent from the year-ago level. The OPEC basket price had exceeded $102 by the middle of March, slipping back towards $96/bbl later in the month. The estimated first quarter of 2008 average prices for the main marker blends are now $96.54 for Brent, $97.31 for WTI and $93.44/bbl for Russian Urals (Mediterranean delivery). The BMI's report assumed an OPEC basket price average of $81 per barrel for 2008, compared with the $74 estimate provided by the company's last quarterly report. Based on recent price differentials, this implies Brent at $84.71, WTI averaging $85.63/bbl, and Urals at $81.88/bbl. Saudi real GDP growth is now forecast by BMI at 4.3 percent for 2008, following an estimated 2.9 percent in 2007. “We are assuming 4.5 percent growth in 2009, 4.1 percent in 2010, 4.4 percent in 2011, followed by 4.2 percent in 2012,” adding “we expect oil demand to rise from an estimated 2.07mn b/d in 2007 to 2.37mn b/d in 2012, representing 3.0 percent annual growth.” BMI also projected that gas production would reach 97.4bcm by 2012, up from an estimated 77bcm in 2007. “Consumption will match the trend, leaving Saudi with no import requirement or export potential during the period,” it said. Between 2007 and 2018, the report forecast an increase in Kingdom oil production of 25.6 percent, with volumes rising steadily to 13.5mn b/d by the end of the 10-year forecast period. Oil consumption between 2007 and 2018 is set to increase by 37 percent, with growth slowing to an assumed 3.0 percent per annum towards the end of the period and the country using 2.83mn b/d by 2018. Gas production is expected to rise from 77bcm to 119bcm by the end of the period. “With 2007-2018 demand growth of 54 percent, this provides a balanced market throughout the period,” BMI said. __
