IEA cuts oil demand forecasts but sees prices staying high

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Reflecting these new forecasts, the IEA cut its estimates for the "call" on OPEC crude, or need for OPEC production, reducing its call estimate for next year by 300,000 b/d to 31.6 million b/d and for the first quarter by 500,000 b/d to 30.8 million b/d.

Brent crude futures traded Friday afternoon at $80.67 per barrel, up from $57.17 per barrel on October 13, 2017.

That means the world's three top producers, Russia, the United States and Saudi Arabia, now all churn out around 11 million bpd, meeting a third of global demand.

As the biggest American stock sell-off in months soured sentiment across markets including raw materials, a measure of oil price volatility surged to the highest level since July during the session on Thursday.

Worldwide oil prices slipped on Thursday, weighed down by the escalating trade dispute between the United States and China, although a decline in USA commercial crude inventories offered some support. Brent crude futures edged up 13 cents to $80.39 a barrel by 0042 GMT.

- Refinery runs fell 352 kbpd last week to 16.2 Mbpd, with the aggregate throughput decline reaching 1.6 Mbpd over the past four weeks. -China trade war tensions escalated and the International Monetary Fund lowered global growth forecast.

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Such disclosures from a respected agency, combined with persistent signs throughout this week that the crude industry could compensate for losses of Iran exports without incurring undue tightening, seemed to baffle media that for the past few months had been predicting calamity due to the US sanctions against the Islamic republic.

“At the heart of this softening oil demand backdrop are a myriad of downward pressures on the global economy, ” said Stephen Brennock, an analyst at brokerage PVM Oil Associates Ltd. That was much larger than what analysts had expected. The contract dropped by 4.3% to $1.933 a day earlier — the lowest finish since March. Prices are down 3.5 percent for the week.

November natural gas NGX18, -2.36% declined by 1.9% to $3.161 per million British thermal units on Friday, but saw a weekly rise of about 0.6%.

In the U.S. Gulf of Mexico, producers had cut output by 40 percent on Thursday due to Hurricane Michael, even as some operators began returning crews to offshore platforms.

US natural-gas supplies in storage stand at about 17% below the five-year average, according to the EIA.

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