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Excess oil inventories to last until 2018 – IEA


Oil demand should outpace supply in the second half of this year but excess inventories will persist well into 2018, dealing a blow to global crude producers enacting output cuts to bring down stubbornly high stockpiles.

The forecast from the International Energy Agency comes as higher than expected demand growth next year is met by even stronger output from the US and other producers outside of the Opec cartel.

In its monthly oil market report, which include forecasts for next year, the Paris-based energy agency said: “[The] outlook for 2018 makes sobering reading for those producers looking to restrain supply.”

Opec and Russia have this year joined forces to cut output and reduce an oil market surplus that is keeping pressure on prices. Producers agreed in May to extend production cuts for a further nine months as US shale production accelerates and countries exempt from the curbs pump more.

The IEA expects global demand growth will increase by 1.4m b/d next year- from 1.3m b/d in 2017 – as China and India take total consumption to a record 99.3m b/d.

But growth in total non-Opec production in 2018, led by the US, will outpace the demand increase. It is forecast to grow by 1.5m b/d, which is more than double the rate of growth this year.

US shale oil production is the biggest component, forecast to grow by 780,000 next year after an increase of 430,000 b/d in 2017. “Such is the dynamism of this extraordinary, very diverse industry it is possible that growth will be faster,” the IEA said.

Opec and Russia have said they seek to bring oil stocks in industrialised nations down to five year average levels. Inventories are currently 292m barrels above this target.

“Incorporating the scenario that Opec countries continue to comply with their output agreement, stocks might not fall to the desired level until close to the expiry of the agreement in March 2018,” said IEA.

This is despite expectations of an oil market deficit in the latter half of this year, when demand is seasonally stronger.

Opec crude oil output rose by almost 300,000 b/d in May to around 32m b/d – the highest level so far this year – as conflict-ridden Libya and Nigeria, which were exempt from the supply deal, produced more. Total Opec output is still lower than the more than 33m b/d it pumped in the last three months of last year.

“’Whatever it takes’ might be the mantra, but the current form of ‘whatever’ is not having as quick an impact as expected”, said the IEA, referring to the commitment by the Saudi energy minister Khalid Al Falih to correct the market imbalance.

“We have regularly counselled that patience is required on the part of those looking for the re-balancing of the oil market, and new data leads us to repeat the message,” the agency said.

4 Comments on "Excess oil inventories to last until 2018 – IEA"

  1. Plantagenet on Thu, 15th Jun 2017 12:36 pm 

    So we’ve got another year of the oil glut? Sure….why not?


  2. DerHundistlos on Thu, 15th Jun 2017 7:15 pm 

    The following “words of wisdom” spoken by Republican Missouri Representative Mike Moon as he decapitates a chicken then tears out its still beating heart:

    “God gave us man dominion over life,” he said. “He allows us to raise animals properly and care for them and then process them for food so we can sustain life. And that’s what I’m doing here with this chicken. So we’ve been called back to this special session for the primary purpose of supporting life, protecting the unborn specifically. I think we need to get to the heart of the matter here. So today, I’m filing a bill that will lead to the stopping of abortion in the state of Missouri and I hope you’ll support it.”

    Our elected leaders and one sick fuck.

  3. Theedrich on Fri, 16th Jun 2017 4:31 am 

    Our oil-thirsty elites are criminals.  They know, or should well know, that ISIS (ISIL, or the “Islamic State”) and its affiliates are the true Islam, as any serious inquiry into the origins and history of Mohammedanism will show.  Mohammed was a vicious and extremely cruel narcissist and schizophrenic warlord who invented a puppet-god to do his maniacal bidding.  Just because the Arabs and their multitudinous neighbors sit on oil-rich land, our rulers deem it legitimate to lie to us, their pawns, that the political ideology (masked as a “religion”) of the Mohammedans is something to be bowed down to.  The history of the Allahists is nothing but blood, and mendacious drivel about the wonderfulness of medieval Andalus (Spain) under their tyranny is deception of the most dangerous sort.  Wherever Mohammedans have taken over, savagery and brutality have displaced any civility worthy of the name.  (Ask the Indians in India about this.)  It is no wonder that the followers of the demonic killer of seventh-century Araby want to emigrate to White lands and occupy them, always pretending that they are “peaceful.”  It is, of course, quite legitimate, even obligatory, for a Muslim to lie to the infidel.  In fact, Mohammedans lie to one another as a matter of course — never mind murdering each other and inflicting horrible punishments such as amputation of limbs for offenses that would bring at most a limited prison term in the West.

    But the Western elites (including judges) could not care less.  They know, or should know, all of this.  But they intend to subject White civilization to their own tyranny, and they use the emotional leftovers of now-defunct Christianity to camouflage their dictatorship.  Whitey accepts this lie and is intellectually too limited to see through it.  We are in an ever-tightening straitjacket imposed by monsters using emotional Christian falsities to strangle us.

  4. Cloggie on Fri, 16th Jun 2017 6:11 am 

    Fossil fuel quarrel EU-USA. The US Senate has demanded that sanctions against Russia needs to increased in an obvious attempt to replace Russian fossil fuel with American. Merkel now clearly sided against this move:

    Overview of the stand-off:

    Trump btw has not yet approved of this scheme.

    The Americans are threatening European countries and companies of penalties if they engage in projects like Nord Stream II.

    Like in 1939, the Americans are again using Poland as the useful idiot in an attempt to again drive a wedge in European unity and set it up against Russia by delivering fuel to Poland.

    It is high time for the Europeans to have:

    1. secret talks with Russia and China about how the world should look like after the end of the American Era and proclaim the Eurasian equivalent of the 1832 Monroe Doctrine that says that Europeans should stay away from the Americas. Likewise Americans and their military have no business in Eurasia and should withdraw. The time of the American Anglo-Zionist Empire is over.
    2. massive armaments program directed at keeping the Americans away from Europe (anti-ship super-sonic missiles).
    3. expansion and Europeanization of the French nuclear attack force to a few thousand war heads.
    4. claiming European patronage over Europeans living in North-America and announcement of the possibility of an intervention in case their interests are harmed, for instance under a Zuckerberg presidency.

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