Smart. Sharp. Funny. Fearless.

Monday, December 09, 2019 {{ new Date().getDay() }}

Paris (AFP) – Global oil demand this year is being slightly boosted by recovery of European economies, and new production is building up fast in a rapidly changing oil market, the IEA said on Friday.

But instability in the Middle East and North Africa is keeping prices up, the Paris-based International Energy Agency said in its monthly review of the oil market.

The agency raised its forecast for demand for oil around the world this year by 90,000 barrels per day to 91.0 million barrels per day (mbd).

Demand for oil this year would rise by 1.1 percent or by 1.0 mbd from the level last year, and by 1.1 mbd in 2014 as the overall economic climate improves.

“Signs of improvement in the European economy support the upward revision,” the agency said.

New non-OPEC production is being driven by U.S. shale-energy output, and an agreement between Sudan and South Sudan opens up prospects of new oil coming on stream.

In addition, production has just begun at the huge Kashagan oil field, under the Caspian Sea off Kazakhstan.

Referring to the shale-energy revolution in North America, the agency said that the United States had produced 10 million barrels per day (mbd) of oil in the last two quarters “its highest in decades.”

The place taken by the United States “in the driver’s seat of growth is also a throwback to decades past” it said.

The United States is set to be the biggest producer outside the Organization of Petroleum Countries (OPEC) grouping by the second quarter of next year.

And this would make the United States a bigger producer than Russia, “and that’s not even counting biofuels and refinery gains,” the IEA forecast.

The IEA noted that just as OPEC production fell below 30.0 mbd for the first time for almost two years, non-OPEC production of oil and other liquids and gains in refining “surged by 1.7 mbd in the third quarter of this year from the equivalent figure last year.

This was “the steepest annual growth for any quarter in over 10-years,” the IEA said.
Non-OPEC supply surge sends ‘ripples through the market’

However, in September alone, the global supply of oil dipped by about 625,000 barrels per day from the August level because of the steep fall in OPEC output.

The rise of non-OPEC production, and fall in OPEC output, “is sending all kinds of ripples through the market,” the report said.

But “amid exceptional outages (of production) in Libya and Iraq, this gusher didn’t do much to douse oil markets,” it said.

Prices for oil had rallied during the quarter, taking the price of Brent North Sea oil up to about $117 per barrel. Prices had then settled back but remained high, the IEA said.

In London on Friday, the price of New York crude was down $1.23 to $101.78 per barrel, and Brent oil was down 29 cents to $111.57 per barrel.

The fall was despite hopes of a breakthrough in the US budget deadlock, as dealers took profits and focused on a U.S. supply glut, analysts said. The market also slid on receding tensions in the Middle East.

The IEA said that the rising trend of non-OPEC production looked like just a “preview” of supplies to come.

But this had been offset in part by a plunge of 1.0 mbd in OPEC production because of a collapse in supplies from Libya owing to instability, and maintenance work in Iraq.

“What seems certain is that surging non-OPEC production does not necessarily equate to a supply glut,” in view of unrest in the Middle East and North Africa.

The IEA said that the global picture of firming economic growth, which raises demand for oil, was clouded by the US budget crisis, by uncertainty over the US debt ceiling, and a recent sharp fall in the value of currencies in many emerging economies.

The agency noted uncertainty about the structure of energy demand in Japan and that “the shutdown of Japan’s entire nuclear power park in early September is expected to affect Japanese oil demand this winter and in 2014 in a big way.”

Donald Trump has been hit with yet another allegation of sexual assault, the Guardian reported on Thursday.

Amy Dorris, a former model, said Trump kissed and groped her without her consent during the 1997 US Open tennis tournament in New York.

She is at least the 42nd woman to accuse Trump of sexual assault or rape.

Keep reading... Show less