Warmer weather, rising non-Opec output threaten oil market balance

Growth in global oil demand is expected to increase more slowly over the next few months as warmer temperatures reduce consumption, which could push the market down in the first half of next year, said Tuesday the International Energy Agency. ]

In its monthly report on the oil market, the Paris-based IEA reduced its forecast of oil demand by 100,000 barrels per day (bpd) for this year and next year, at 1 , 5 million bpd in 2017 and 1.3 million bpd in 2018.

Geopolitical tensions in the Middle East and intermittent supply interruptions in Nigeria and Iraq pushed oil to more than $ 60 a barrel for the first time since 2015, while global stocks declined.

"Does this mean that the market has found a" new normal "where the accepted floor could have gone from $ 50 / bbl to $ 60 / bbl? This could be tempting, assuming the disruptions Supply will continue and that tensions in the Middle East will not abate, "said the IEA.

"However, if these problems prove to be temporary, a re-examination of the fundamentals confirms the view expressed last month that the market balance in 2018 does not seem as tight as some would like it to be, and it is not the case. there is not a "new normal".

The IEA notes that the output of the Organization of the Petroleum Exporting Countries decreased by 830,000 bpd in October, although the demand for the group's crude oil is expected to fall to 32.6 million bpd in fourth quarter of this year and 32.0 million bpd in the first quarter of 2018.

The group's compliance with its 1.8 million bpd production reduction with 10 partners was 96% in October, the highest since the entry into force of the reduction agreement. the offer in January.

The greatest threat to market equilibrium, apart from a decline in demand, is the growth in supply from non-OPEC countries.

"Even after modest reductions in growth, non-OPEC production will follow this year's 700,000 bpd growth with 1.4 million bpd of additional production in 2018 and growth in demand for it." next year will struggle to match. "

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