What are the key factors driving the eastward shift in oil trade to non-OECD Asia

The key factors driving the eastward shift in oil trade to non-OECD Asia are:

1. Rapidly growing oil demand in non-OECD Asia, especially China and India, which is projected to nearly double by 2050.

This demand growth is primarily driven by the transportation and industrial sectors.

2. Stagnant or declining oil production in major non-OECD Asian countries like China and India, leading to a growing structural shortfall in crude and oil products[3]. For example, India’s crude oil production will decline by 2050 while consumption will triple.

3. Surplus crude oil supply in the Atlantic Basin, including from the United States, Canada, Brazil and Russia, which is increasingly being exported to Asia.

4. Sanctions on Russian crude exports and OPEC+ voluntary production cuts, which are pushing higher volumes from the Atlantic Basin to East of Suez.

5. The Middle East’s proximity to growing non-OECD Asian markets and its role as a prevalent supplier of crude oil to the region, which is projected to continue as Asian demand increases[3].6. Expansion of infrastructure like pipelines and LNG terminals in major producers like the United States, Russia and the Middle East to facilitate increased exports to Asia.

In summary, the combination of surging oil demand and limited domestic production in non-OECD Asia, along with growing supply surpluses in the Atlantic Basin and Middle East, is driving the eastward shift in global oil trade flows

To learn more about NTEK and its range of our products, please visit our blog