(Corrects to read imports (not outlets), paragraph 13)
By Mohi Narayan and Shariq Khan
BENGALURU, India, Feb 5 (Reuters) - Oil producers may
have to reconsider their output policies following a demand
recovery in China, the world's second-largest oil consumer, the
International Energy Agency's Executive Director Fatih Birol
said on Sunday.
China, the world's largest crude importer and No. 2 buyer of
liquefied natural gas, has become the biggest uncertain factor
in global oil and gas markets in 2023 as investors bet on the
speed of its recovery after Beijing lifted COVID restrictions in
December.
"We expect about half of the growth in global oil demand
this year will come from China," Birol told Reuters on the
sidelines of the India Energy Week conference.
He added that China's jet fuel demand is exploding, putting
upward pressure on demand.
"If demand goes up very strongly, if the Chinese economy
rebounds, then there will be a need, in my view, for the OPEC+
countries to look at their (output) policies," Birol said.
Producer group OPEC+ angered the United States and other
Western nations in October when it decided to cut output by 2
million barrels a day from November through 2023, instead of
pumping more to cut fuel prices and help the global economy as
the U.S. advised.
Birol said he hoped such a situation does not repeat, and
that OPEC+ - which includes members of the Organization of the
Petroleum Exporting Countries and allies such as Russia - will
return to a constructive role in the market as demand improves.
OPEC+ rolled over the group's current output policy at a
meeting on Wednesday, leaving production cuts agreed last year
in place.
Separately, Birol said price caps on Russian oil likely cut
Moscow's revenues from oil and gas exports by nearly 30% in
January, or about $8 billion, compared to a year before.
G7 nations, the European Commission and Australia this week
approved a $100 per barrel price cap on diesel and a $45 per
barrel cap on discounted products such as fuel oil starting from
Feb. 5.
This followed a similar measure they implemented on Dec. 5
barring Western-supplied maritime insurance, finance and
brokering for seaborne Russian crude unless it was sold below a
$60 price cap.
Birol said fuel markets might face difficulties in the short
term as global trade routes "reshuffle" to accommodate Europe
drawing on more imports from China, India, the Middle East and
the United States.
That could force other markets such as Latin America to
scout for alternative imports, he said.
Europe has decided to end refined fuel imports from Russia
from Sunday.
Birol said however that the fuel market balance could
improve from the second half as more refining capacity is added
globally.
(Reporting by Nidhi Verma, Mohi Narayan, Shariq Khan and
Florence Tan; Editing by Jan Harvey)
florence.tan.thomsonreuters.com@reuters.net))
