Jakarta (Indonesia Window) – The Indonesian Crude Price (ICP) in October 2021 reached 81.80 U.S. dollars per barrel, an increase of 9.60 U.S. dollars per barrel from 72.20 U.S. dollars per barrel in the previous month, according to a written statement from the Ministry of Energy and Mineral Resources received here on Saturday.
The executive summary of the Indonesian crude oil price team indicated that the ICP of SLC also rose by 9.27 dollars per barrel from 72.25 dollars per barrel to 81.52 dollars per barrel.
The executive summary explained that the development of the average price of main crude oil on the international market in October 2021 has increased compared to that in September 2021.
Several influencing factors include the gas supply crisis and the increase in coal prices which have resulted in electricity crises in Europe and Asia as they enter the winter season, which is predicted to be colder than before. This condition increases the demand for crude oil as a substitute fuel.
Another factor is the agreement of OPEC+ (Organization of Petroleum Exporting Countries) not to increase their production and would only continue to increase production by 400,000 BOPD (barrels oil per day) per month despite increasing demand for crude oil.
OPEC in its October 2021 report said that global crude oil demand in the fourth quarter of 2021 was projected to increase by 0.12 million BOPD to 99.82 million BOPD compared to that in the previous month.
In addition, the decline in crude oil production of non-OPEC countries in the fourth quarter of 2021 was projected at 3.2 million BOPD to 65.24 million BOPD compared to that in the previous month.
Meanwhile, the Energy Information Administration (EIA) report showed a decrease in gasoline and distillate stocks in the United States compared to the end of the previous month. Gasoline stocks fell by 6.1 million barrels to 215.7 million barrels, while distillate stocks dropped by 4.7 million barrels to 125.0 million barrels.
The increase in oil prices was also influenced by economic recovery and industrial growth after the pandemic, increasing demand for energy, especially crude oil.
In the Asia and Pacific region, the increase in crude oil prices was influenced by the early winter in China, increasing demand for coal, gas and crude oil faster than expected.
Another factor in increasing the ICP is the rise in crude oil imports in Asia.
India is expected to increase imports by 310,000 barrels to 4.19 million BOPD compared to September 2021 as the economy improves after COVID-19.
Japan is expected to import 3.01 million barrels, the highest this year, for reserves to meet winter demands.
South Korea is estimated to import 2.99 million BOPD to ensure winter and post-COVID-19 demands are fulfilled.
The development of world oil prices during October is as follows:
Dated Brent rose 9.08 dollars per barrel from 74.58 dollars per barrel, to 83.66 dollars per barrel.
WTI (Nymex) rose by 9.68 dollars per barrel from 71.54 dollars per barrel, to 81.22 dollars per barrel.
The OPEC basket rose by 8.19 dollars a barrel from 73.88 dollars a barrel, to 82.07 dollars per barrel.
Brent (ICE) rose by 8.87 dollars per barrel from 74.88 dollars per barrel, to 83.75 dollars per barrel.
Reporting by Indonesia Window