The latest Brazil Oil & Gas Report from BMI forecasts that the country will account for 31.80% of Latin American regional oil demand by 2013, while providing 27.36% of supply. Latin America regional oil use of 6.66mn barrels per day (b/d) in 2001 reached an estimated 7.72mn b/d in 2008. It should average 7.86mn b/d in 2009 and then rise to around 8.58mn b/d by 2013. Regional oil production was just under 10.40mn b/d in 2001, and in 2008 averaged an estimated 9.99mn b/d. It is set to rise to 10.78mn b/d by 2013. Oil exports are slipping, because demand growth is exceeding the pace of supply expansion. In 2001, the region was exporting an average 3.73mn b/d. This total had fallen to an estimated 2.27mn b/d in 2008 and is forecast to be 2.21mn b/d in 2013. In terms of natural gas, the Latin America region in 2008 consumed an estimated 194bn cubic metres (bcm), with demand of 266bcm targeted for 2013, representing 45% growth. Estimated production of 208bcm in 2008 should reach 294bcm in 2013, and implies 28bcm of net exports at the end of the period. Brazil's share of gas consumption in 2008 was an estimated 12.09%, while its share of production was 6%. By 2013, its share of gas consumption is forecast to be 11.39%, with the country accounting for 8.51% of supply. In terms of the OPEC basket of crudes, the average price in the fourth quarter of 2008 (Q408) was an estimated US$52.53/bbl, down sharply from the US$113.49 recorded during the previous three months. The full year 2008 average is put by BMI at US$94.08/bbl, representing a 36% year-on-year (y-o-y) increase. North Sea Brent, WTI and Russian Urals are believed to have averaged US$97.06, US$99.33 and US$94.56/bbl respectively during 2008. For 2009, we are now assuming an average OPEC basket price of US$52/bbl (-45% y-o-y), with Q109 expected to deliver US$40.00. The new full year forecast implies Brent crude at US$55.65, WTI averaging US$56.63/bbl and Urals at US$52.48 for 2009. For 2010, we expect to see a recovery to US$58.00/bbl for the OPEC price, gaining further ground to US$65.00 in 2011 and US$70.00/bbl in 2012. We are now using a long-term price assumption of US$70.00 for 2013-2018, down from our previous assumption of US$90.00/bbl. In 2009, we see monthly average global wholesale gasoline prices ranging from US$38.90 in January to a high of US$64.90 reached in August and in December, providing a full year average of US$56.20 - just over 55% of the 2008 outturn.
The 2009 BMI gasoil forecast is for an average price of US$67 per barrel (bbl), assuming a monthly low of US$46.40 in January and a high of US$77.30/bbl in December. The full-year outturn represents a 45% downturn from the 2008 level. For 2009, the monthly average jet fuel price is forecast to range from US$47.90 in January to US$79.80/bbl in August, proving an annual level of US$69.20/bbl. Brazilian real GDP growth is now forecast by BMI at 2.3% for 2009, following an estimated 5.7% in 2008. We are assuming 2.6% growth in 2010, 4.3% in 2011, followed by 4.5% in 2012 and 4.1% in 2013. Partly-privatised deepwater specialist Petrobras will continue to partner international oil companies (IOCs) in supporting output growth efforts, while dominating domestic production. We are assuming oil and gas liquids production of at least 2.95mn b/d by 2013, with the country expected to pump 2.30mn b/d in 2009. Consumption is forecast to increase by 3.0-3.5% per annum to 2013, implying demand of 2.73mn b/d by the end of the forecast period. The export capability would therefore be approximately 0.56mn b/d by 2013. Gas production is forecast to increase from an estimated 12.5bcm in 2008 to 25.0bcm over the period to 2013, with consumption climbing from 23.4bcm to 30.4bcm. Between 2007 and 2018, we are forecasting an increase in Brazilian oil production of 135%, with crude volumes rising steadily to 4.3mn b/d by 2018. Oil consumption between 2007 and 2018 is set to increase by 41%, with growth slowing to an assumed 2% per annum towards the end of the period and the country using 3.09mn b/d by 2018. Gas production is expected to rise gradually, from an estimated 12.5bcm in 2008 to 35.0bcm by 2018. With demand growth of 68%, this provides a net import requirement falling from an estimated 10.9bcm to 1.9bcm during the 10-year period. Details of BMI's 10-year forecasts can be found in the appendix to this report, which provides global, regional and country-specific projections. Brazil this quarter retakes outright first place in BMI's updated Upstream Business Environment rating, moving ahead of Venezuela, thanks to the size of the oil resource base, output growth prospects, attractive licensing regime and competitive environment. While some weak points exist in terms of the country's risk ratings and only mid-table reserves-to-
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