North America Commodities Research18 January 2024J P M O R G A Nwww.jpmorganmarkets.comGlobal Commodities ResearchPrateek Kedia AC(1-646) 326 1124prateek.kedia@jpmchase.comJ.P. Morgan Securities LLCNatasha Kaneva AC(1-212) 834-3175natasha.kaneva@jpmorgan.comJPMorgan Chase Bank NACole Wolf AC(1-212) 622-5762cole.wolf@jpmchase.comJ.P. Morgan Securities LLC•Our high-frequency demand indicators are tracking a 1.5 mbd month-over-month decline in global oil demand through January 18 (Figure 1). This compares favorably to the 1.7 mbd decline in the last week�s reading and the pre-COVID five-year average MoM drop of 2.3 mbd for January. •Regionally, Thailand, France and Portugal reported oil consumption statistics.•France and Portugal reported their oil consumption data for December 2023. France�s oil demand in December contracted 48 kbd YoY led by weak diesel demand. For the year, France�s total oil consumption contracted 24 kbd as diesel and fuel oil demand weakness offset demand expansion in jet fuel and gasoline. In Portugal, total oil demand in December remained stable at 178 kbd, up 2 kbd YoY. For 2023, oil demand recorded a 11 kbd YoY increase supported by jet fuel, diesel, and gasoline demand. Jet fuel demand rose to 110% of 2019 volumes benefitting from increased international travel activity. •Our Europe demand tracker for January suggests demand may overshoot our 13.5 mbd estimate by 300 kbd as teeth-chattering temperatures are likely driving consumers to crank up their heating demand.•US gasoline demand is tracking 100 kbd above our published estimates at 8.5 mbd (Figure 8). The stronger-than-expected gasoline consumption is also reflected in 36.8 million more weekly trips undertaken by American drivers in the first week of January relative to same period last year (Figure 12). •China demand for December came in at 15.9 mbd, 300 kbd below our estimates on account of lower LPG and �other products� demand. For January, demand is tracking 15.6 mbd, 400 kbd below our published estimates. We believe warmer-than-normal winter weather in East Asia is undermining heating demand in the region, China included. On the bright side, trucks on Chinese expressways rose by 4.9 million to 53.8 million, a six-week high.•Thailand reported a 23 kbd YoY decline in its total oil consumption for November 2023 led by a 34 kbd YoY drop in diesel demand. The nation�s diesel demand has contracted every month since February on account of cooling growth and deteriorating manufacturing activity. On the other hand, air travel activity continues to normalize in the region. As a result, jet fuel demand recovered to 71% of 2019 volumes.•Global jet fuel demand expanded 480 kbd YoY for the week ending January 12, the smallest weekly YoY gain since 2023. This aligns with lower global flights activity last week as severe weather conditions caused flight disruptio...
