WTI Oil Edges Down as the IEA Sees the Market Over Supplied in 2025
West Texas Intermediate (WTI) oil closed lower on Thursday as the International Energy Agency said it continues to expect supply to exceed demand in 2025.
WTI crude oil for February delivery closed down US$0.27 to settle at US$70.02 per barrel, while February Brent crude was last seen down US$0.10 to US$73.42.
In its monthly Oil Market Report, the IEA trimmed its forecast for 2024 demand growth to 0.84 million barrels per day, down from its November estimate of 0.92-milllion bpd. For 2025, the agency sees demand rising 1.1-million bpd to 103.9-million bpd, up from just under one-million bpd.
However the IEA expects supply to average 104.8-million bpd in 2025, not including the potential return of 2.2-million bpd of voluntary supply cuts from OPEC+, with the cartel earlier this month delaying the start of supply additions to April. The IEA said its forecast is based on rising production from the United States, Canada and South America.
"The decision by OPEC+ to delay the unwinding of its additional voluntary production cuts by another three months and extend the ramp-up period by nine months through September 2026 has materially reduced the potential supply overhang that was set to emerge next year. Even so, persistent overproduction from some OPEC+ members, robust supply growth from non-OPEC+ countries and relatively modest global oil demand growth leaves the market looking comfortably supplied in 2025," the report noted.
The agency expects demand growth to be led by Asian countries outside of China, where demand has stalled due to its struggling economy.
Source : (MT Newswires)
