The world’s appetite for crude is making a comeback as economies improve and cheap oil draws out more buyers, the International Energy Agency says.
In its monthly oil market report released today, the IEA revised its estimate of daily global oil demand in the first half of the year by 400,000 barrels, as the United States and other developed nations reversed a “long declining, seemingly entrenched, trend to a rising one.”
Worldwide, daily demand was 93.3 million barrels for the last six months, up 1.6 million from the same period last year. And the IEA believes demand could rise to 94 million barrels for the whole year, up 1.4 million barrels from 2014, when demand had collapsed in China and elsewhere.
But as FuelFix.com reports, the Paris-based group, which has a membership of 29 oil-importing countries, says the momentum in the oil markets could slow in the second half of the year as lower crude prices lose their luster and as the passing economic bounce fades in developed nations.
And meanwhile, the IEA is predicting oil supplies will ratchet up again this year. Supplies slipped by 150,000 barrels a day last month, dipping to 96 million barrels, but it was still 3 million barrels higher than it in the same month last year.
It estimated OPEC production grew to a three-year high, climbing by 50,000 barrels a day to 31.33 million barrels a day. That’s more than twice the growth figure the 12-member Organization of Petroleum Exporting Countries had provided in its own monthly oil report on Wednesday.
The IEA says Saudi Arabia, Iraq and the United Arab Emirates pumped record monthly levels of crude in May, and that it doesn’t expect OPEC to let production slip below 31 million barrels a day in coming months, as “Middle East producers sustain higher rates to preserve market share and meet summer domestic demand.”
Outside of the OPEC nations, the IEA says, production fell by 200,000 barrels a day last month, to 58 million barrels a day, hampered by wildfires in Canada and maintenance in the North Sea.
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