IEA sees risks of oil prices falling back, if surplus persists in 2017

Paris-based International Energy Agency (IEA) published its monthly report on oil markets this Thursday, noting that oil markets are likely to register surplus for the third consecutive year, if the OPEC fails to reach an output cut deal at its Nov. 30 Vienna meeting.

Key Points via Reuters:

Global supply rose by 800,000 barrels per day (bpd) in October to 97.8 million bpd, led by record OPEC output and rising production from non-OPEC members such as Russia, Brazil, Canada and Kazakhstan.

Demand growth forecast for 2016 seen at 1.2 million bpd and forecasts consumption will increase at the same pace next year, having gradually slowed from a five-year peak of 1.8 million bpd in 2015.

According to IEA, "If no agreement is reached and some individual members continue to expand their production then the market will remain in surplus throughout the year, with little prospect of oil prices rising significantly higher. Indeed, if the supply surplus persists in 2017 there must be some risk of prices falling back."

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