Global oil market seen balanced in 2018, even with rising output

OPEC supply was little changed in September at 32.65 million bpd, but down 400,000 bpd from a year earlier. (Reuters)
Updated 12 October 2017
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Global oil market seen balanced in 2018, even with rising output

LONDON: Global supply and demand for crude oil will be largely balanced next year, as growth in consumption helps erode a three-year-old overhang of unused fuel and should mostly offset a steep rise in output, the International Energy Agency said on Thursday.
In its monthly oil market report, the Paris-based IEA said it continues to see global demand for crude growing by 1.6 million barrels per day (bpd) in 2017, before moderating to 1.4 million bpd in 2018.
“Looking into 2018, we see that three quarters out of four will be roughly balanced — again using an assumption of unchanged OPEC production, and based on normal weather conditions,” the agency said.
“Taking 2018 as a whole, oil demand and non-OPEC production will grow by roughly the same volume and it is this current outlook that might act as the ceiling for aspirations of higher oil prices.”
Commercial oil stocks likely fell in the third quarter of this year, only the second draw since the crude price crashed in 2014, thanks to a drop in the amount of oil held in floating storage or in transit, the IEA said.
Commercial stocks in industrialized countries fell in August by 14.2 million barrels to 3.015 billion barrels, leaving a surplus of 170 million barrels above the five-year average, the IEA said.
However, the IEA said its numbers implied a build of up to could take place in the first quarter of next year, meaning the Organization of the Petroleum Exporting Countries and its partners cannot afford a slip in adherence to their supply-restraint deal.
OPEC supply was little changed in September at 32.65 million bpd, but down 400,000 bpd from a year earlier, meaning the group’s compliance with its self-imposed 1.2-million bpd output cut stood at 88 percent last month and 86 percent for the year to date, the IEA said.
Together with its partners, which include Russia, Oman and Kazakhstan, the group has agreed to restrain output by 1.8 million bpd until March next year.
“There is little doubt that leading producers have re-committed to do whatever it takes to underpin the market and to support the long process of rebalancing,” the agency said.
“A lot has been achieved toward stabilizing the market, but to build on this success in 2018 will require continued discipline.”
The IEA said it expects demand for OPEC’s crude to rise to 32.98 million bpd in the fourth quarter of this year, above September’s output, and then to fall to 31.87 million bpd in the first three months of 2018.
The IEA said it sees non-OPEC crude supply rising by 700,000 bpd in 2017, and by 1.5 million in 2018 to reach 59.6 million bpd, with the United States being the largest contributor.
“Production likely rebounded in the North Sea and in Brazil, while the continued ramp-up of production from new fields in Kazakhstan, Ghana and Congo also contributed. At 57.9 million bpd, total non-OPEC output stood 975,000 bpd above a year earlier,” the agency said.
US crude production, aided in large part by resurgent shale output, grew by 550,000 bpd in July compared with a year earlier to 9.24 million bpd, its highest since November 2015.
The impact of Hurricane Harvey, which hit the US Gulf Coast in late August, is expected to have curtailed production in August and September.
But for 2017 as a whole, the IEA expects US crude output to grow by 470,000 bpd and by 1.1 million bpd in 2018.


Twitter suspended 58 million accounts in 2017 fourth quarter

Updated 31 sec ago
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Twitter suspended 58 million accounts in 2017 fourth quarter

  • Twitter executives say efforts to clean up the platform are a priority
  • Company has been struggling with user growth compared to rivals like Instagram and Facebook

NEW YORK: Twitter suspended at least 58 million user accounts in the final three months of 2017, according to data obtained by The Associated Press. The figure highlights the company’s newly aggressive stance against malicious or suspicious accounts in the wake of Russian disinformation efforts during the 2016 US presidential campaign.
Last week, Twitter confirmed a Washington Post report that it had suspended 70 million accounts in May and June. The cavalcade of suspensions has raised questions as to whether the crackdown could affect Twitter’s user growth and whether the company should have warned investors earlier. The company has been struggling with user growth compared to rivals like Instagram and Facebook.
The number of suspended accounts originated with Twitter’s “firehose,” a data stream it makes available to academics, companies and others willing to pay for it.
The new figure sheds light on Twitter’s attempt to improve “information quality” on its service, its term for countering fake accounts, bots, disinformation and other malicious occurrences. Such activity was rampant on Twitter and other social-media networks during the 2016 campaign, much of it originating with the Internet Research Agency, a since-shuttered Russian “troll farm” implicated in election-disruption efforts by the US special counsel and congressional investigations.
Suspensions surged over the fourth quarter. Twitter suspended roughly 15 million accounts last October. That number jumped by two-thirds to more than 25 million in December.
Twitter declined to comment on the data. But its executives have said that efforts to clean up the platform are a priority, while acknowledging that its crackdown has affected and may continue to affect user numbers.
Twitter said in April it had 336 million monthly active users, which it defines as accounts that have logged in at least once during the previous 30 days. The suspended accounts do not appear to have made a large dent in this number, which was up 3 percent from a year earlier. Twitter maintains that most of the suspended accounts had been dormant for at least a month, and thus weren’t included in its active user numbers.
Michael Pachter, a stock analyst with Wedbush Securities, said he thinks the purge late last year may have been part of an initial sweep of inactive accounts that had little effect on activity or advertising revenue. But he said he expected advertising revenue to fall 1 to 2 percent due to the more recent purge last week, when Twitter said it was removing frozen accounts from follower counts.
He expects the company to be upfront about the impact when it announces quarterly earnings on July 27, and said the cleanup is good for users and advertisers. “They’re certainly doing the right thing,” he said.
Scott Kessler, an analyst with CFRA who has a “sell” rating on Twitter stock, said multiple reports and vague clarifications by executives are creating uncertainty about what Twitter’s numbers really mean.
The purge activity “adds a level of uncertainty,” he said. “As an analyst, I want a more genuine view of the user base.”
Chief Financial Officer Ned Segal said in February that some of the company’s “information quality efforts” that include removing accounts could affect monthly user figures. Segal offered no specifics.
Six months later, in late June, Twitter disclosed that its systems found nearly 10 million “potentially spammy or automated accounts per week” in the month of May, and 6.4 million per week in December 2017. That’s up from 3.2 million per week in September. The company didn’t say how many of these identified accounts were actually suspended.
Following the Post report, which caused Twitter’s stock to drop sharply, Segal took to Twitter to reassure investors that this number didn’t count in the company’s user metrics. “If we removed 70M accounts from our reported metrics, you would hear directly from us,” he tweeted last Monday .
Shares recovered somewhat after that tweet. The stock has largely been on an upswing lately, and more than doubled its value in the past year.
Twitter is taking other steps besides account deletions to combat misuse of its service, working to rein in hate and abuse even as it tries to stay true to its roots as a bastion of free expression. Last fall, it vowed to crack down on hate speech and sexual harassment and CEO Jack Dorsey echoed the concerns of critics who said the company hasn’t done enough to curb such abuse.