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IEA: Oil market oversupply to be smaller than expected in 2017

by ChemOrbis Editorial Team - content@chemorbis.com
  • 14/06/2016 (15:11)
According to media reports, the International Energy Agency (IEA) reported that oversupply in the global oil markets will be less than initially expected in 2017 in line with faster than expected growth in demand and lower production from non-OPEC countries. The agency said that the oil surplus in the first half of this year was about 800,000 barrels a day (bpd), lower than the IEA’s earlier estimates of 1.3 million bpd.

For 2017, the IEA expects global oil demand to rise by 1.3 million bpd to reach 97.4 million bpd. According to the IEA, non-OPEC production will post a modest increase of 200,000 bpd next year due to limited production in Canada and Brazil while US oil output will recover as of the second half of the next year. The agency also stated that global oil stocks will decline by 100,000 bpd through the year.

Regarding OPEC oil production, the IEA expect to see stronger demand as non-OPEC production will be unable to meet the increasing global demand. In 2017, OPEC will need to produce 33.5 million bpd and Iran may increase its oil output by 100,000 bpd to around 3.7 million bpd, according to the IEA’s latest report.

In addition, according to the IEA, global oil demand will increase by 100,000 bpd in 2016 on the back of stronger fuel demand in the US while oil production outside the OPEC nations will decline by 100,000 bpd this year.
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