The latest Germany Oil & Gas Report from BMI forecasts that the country will account for 17.72% of developed European regional oil demand by 2013, while making a contribution of just 1.06% to supply. In Developed Europe, overall oil consumption reached 13.62mn barrels per day (b/d) in 2008. It is set to ease to around 13.60mn b/d by 2013. Developed Europe regional oil production was 6.97mn b/d in 2001, and in 2008 averaged 4.90mn b/d. It is set to fall to just 3.77mn b/d by 2013. Oil imports are growing steadily, because supply is contracting and demand is rising, albeit slowly. In 2008, net crude imports were 8.72mn b/d. By 2013, they are expected to have reached 9.84mn b/d. Norway will remain the only major net exporter, with the UK becoming a net importer. As regards natural gas, the Developed Europe region in 2008 consumed 445bn cubic metres (bcm), with demand of 478bcm targeted for 2013, representing 7.3% growth. Production of 269bcm in 2008 should rise to 278bcm in 2013, which implies net imports rising from the 2008 level of 176bcm to some 267bcm by the end of the period. Germany's share of gas consumption in 2008 was 18.41%, while it accounted for 4.84% of production. By 2013, its share of gas consumption is forecast to be 19.45%, with a 4.32% share of production. For 2009 as a whole, we are now assuming an average OPEC basket price of US$55.00 per barrel (bbl), a 41.5% decline year-on-year (y-o-y). This represents an upgrade from the US$52 forecast we have stuck with during the past three quarters. Our OPEC basket assumption delivers likely Brent, WTI, Urals and Dubai prices of US$56.30, US$57.50, US$55.60 and US$55.60/bbl respectively. For 2010, we expect to see a recovery to US$60.00/bbl for the OPEC price (up from our previous forecast of US$58), gaining further ground to US$65.00 in 2011 and to US$70.00/bbl in 2012. Our post-2010 forecasts are unchanged and we are continuing to use a long-term price assumption of US$70.00 for 2013-2018. In 2009, BMI is now assuming a global average gasoline price of US$62.12/bbl, with the fuel having peaked in June. The overall y-o-y fall in 2009 gasoline prices is put at 40.0%. The BMI gasoil forecast is for an average price of US$68.62/bbl, assuming a monthly high of US$92.49/bbl in December. The fullyear outturn represents a 43.4% fall from the 2008 level. The annual jet price level for 2009 is forecast to be US$65.17/bbl. This compares with US$124.95/bbl in 2008. The 2009 average naphtha price is put by BMI at US$49.06/bbl, down 43.9% from the previous year's level. German real GDP growth is now forecast by BMI to fall 5.9% in 2009, compared with growth of 1.3% in 2008. We are assuming an average 0.1% GDP contraction in 2009-2013. Our forecast is for minimal oil demand growth to 2013, with end-period consumption at no more than 2.41mn b/d after declining demand in 2008/09. Gas consumption is now 24% of primary energy demand, accounting for 11% of power generation supply. Our estimate is for gas demand to rise from 82bcm in 2008 to 93bcm by 2013. Germany's gas production is forecast to fall from 13bcm in 2008 to 12bcm over the period. Between 2008 and 2018, we are forecasting a decrease in German oil and gas liquids consumption of 8.51%, with volumes peaking at 2.41mn b/d in 2011-13, then heading lower to 2.29mn b/d by the end of the 10-year forecast period. Production is set to fall from an estimated 60,000b/d to just 30,000b/d during the same period. Gas demand should rise from the 2008 level of 82bcm to a peak of 93bcm by 2013/2014, before slipping back to 90bcm by 2016-2018. Imports are expected to peak at 81.5bcm in 2014, in the form of pipeline volumes. Details of BMI's 10-year forecasts can be found in the appendix to this report. According to BMI's Country Risk team, Germany's long-term political risk score is 84.4, compared with the Developed Markets average of 87.5 and the global average of 63.6. Our long-term economic rating for the country is 71.0, above the Developed Markets average of 70.0 and above the global average of 53.7. Germany has a privatised energy sector operating under EU guidelines. There is a small upstream oil and gas segment, with international oil company (IOC) and local company involvement. Downstream oil features a mixture of IOCs and domestic companies, while gas and electricity interests remain in largely German (non-state) hands.
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