AFP, Paris :
A global oil glut that has sent prices tumbling is set to “shrink dramatically” later this year, as wildfires have disrupted Canada’s output and demand in India soars, the International Energy Agency (IEA) said Thursday.
Demand for oil worldwide is set to grow at a “solid” rate in 2016, with India the “star performer” after making up nearly 30 percent of the global increase in demand in the first quarter of the year, the IEA said.
“This provides further support for the argument that India is taking over from the China as the main growth market for oil,” the 29-nation IEA said in its closely watched monthly report.
The oil market has for months been depressed by vast oversupply, badly hurting producers but meaning lower prices at the pump for consumers.
Crude oil prices surged to six-month highs this week and are well over $46 a barrel after plummeting below $30 early in the year. They are nevertheless far below the $100-a-barrel mark of mid-2014.
The IEA said further price rises were likely to be “limited” until plentiful stocks are drawn down towards the end of this year.
In Canada devastating wildfires near Fort McMurray forced a shutdown of 1.2 million barrels a day (mb/d) of production early this month.
The IEA said the events in Canada, however, had not sent oil prices sharply higher, as would have been expected some years ago, with crude having shown little reaction amid overall improved market sentiment.
Iran, the IEA said, had provided the other surprise.
Its oil production and exports increased slightly faster than expected following Iran’s return to the market after the lifting of sanctions in January under its nuclear deal.
Iranian oil production in April was nearly 3.6 mb/d, a level last achieved in November 2011 before Western sanctions against Tehran were tightened, the IEA said.
“Even more important for global markets, oil exports reached 2 mb/d, a dramatic increase from the 1.4 mb/d seen in March,” it added.
The rise in Iran helped push production within OPEC (Organization of the Petroleum Exporting Countries) 330,000 b/d higher in April, the group’s highest level in more than seven years.
A global oil glut that has sent prices tumbling is set to “shrink dramatically” later this year, as wildfires have disrupted Canada’s output and demand in India soars, the International Energy Agency (IEA) said Thursday.
Demand for oil worldwide is set to grow at a “solid” rate in 2016, with India the “star performer” after making up nearly 30 percent of the global increase in demand in the first quarter of the year, the IEA said.
“This provides further support for the argument that India is taking over from the China as the main growth market for oil,” the 29-nation IEA said in its closely watched monthly report.
The oil market has for months been depressed by vast oversupply, badly hurting producers but meaning lower prices at the pump for consumers.
Crude oil prices surged to six-month highs this week and are well over $46 a barrel after plummeting below $30 early in the year. They are nevertheless far below the $100-a-barrel mark of mid-2014.
The IEA said further price rises were likely to be “limited” until plentiful stocks are drawn down towards the end of this year.
In Canada devastating wildfires near Fort McMurray forced a shutdown of 1.2 million barrels a day (mb/d) of production early this month.
The IEA said the events in Canada, however, had not sent oil prices sharply higher, as would have been expected some years ago, with crude having shown little reaction amid overall improved market sentiment.
Iran, the IEA said, had provided the other surprise.
Its oil production and exports increased slightly faster than expected following Iran’s return to the market after the lifting of sanctions in January under its nuclear deal.
Iranian oil production in April was nearly 3.6 mb/d, a level last achieved in November 2011 before Western sanctions against Tehran were tightened, the IEA said.
“Even more important for global markets, oil exports reached 2 mb/d, a dramatic increase from the 1.4 mb/d seen in March,” it added.
The rise in Iran helped push production within OPEC (Organization of the Petroleum Exporting Countries) 330,000 b/d higher in April, the group’s highest level in more than seven years.
