Oil in global economy series: key highlights from iea’s momr
Yesterday, International Energy Agency released its monthly oil market report. The report suggests an easing oil market. Here are the key highlights,
- Global oil supply holding steady close to 98 million barrels per day, as lower OPEC production is offset by higher non-OPEC growth led by the United States. Output was 1.78 million barrels per day higher than a year ago, largely due to higher production in the U.S.
- Due to the strong growth in U.S. production, IEA expects global supplies to rise by 1.87 million barrels per day in 2018 compared to the previous forecast of 1.8 million barrels per day and growth of 0.76 million barrels in 2017.
- According to IEA’s calculations, OPEC produced 31.65 million barrels per day in April, due to lower production in Venezuela and African countries.
- According to IEA, OPEC compliance to the production cut agreement has hit 172 percent.
- IEA expects OPEC production average at 32.25 million barrels per day in 2018.
- According to IEA, the global oil demand was 97.8 million barrels per day in 2017.
- IEA estimates demand growth for 2018 at 1.4 million barrels per day, which is slightly lower than the last forecast of 1.5 million barrels per day.
- IEA expects demand slowdown in H2 2018 despite strong Q1 and Q2 demand due to higher oil price.
- On the inventory side, IEA report shows that OECD commercial stocks declined by 26.8 million barrels in March.
- OECD commercial stocks are currently at 2,819 million barrels, which is 1 million barrels lower than the five-year average. It is also the lowest level for crude stocks since March 2015.
- Stocks declined 154 million barrels in 2017 and down 214 million barrels from a year ago.
WTI is currently trading at $71.6 per barrel and Brent at $7.7 per barrel premium to WTI.
Source: FXWire Commentary