The oil price rally could slow down over the coming months thanks to increased global supply, according to the International Energy Agency’s latest monthly report.
After hitting levels that had not been seen in a long time in September, as supplies continued to dwindle, with Brent and WTI at around $86 and $84, the IEA has announced that the first important signs of a possible trend reversal can be seen on the horizon.
In fact, global oil production is already on the rise. In October, supplies were up by 1.4 million barrels per day, reaching 97.7 mpd (million barrels per day). Despite the fact that OPEC+ has ignored requests to increase production beyond 400 thousand barrels per day in order to bring prices down, the IEA forecasts a further 1.5 mpd increase between November and December. Supporting the new wave will be mainly the USA, which is set to produce around 400,000 bpd over the last two months of the year, while Saudi Arabia and Russia together should reach 330,000 bpd. About half of the world’s crude oil is shipped by sea.
The increased production will go some way towards satisfying growing demand, which is still recovering from the Covid 2020 slump. The demand for oil is expected to rise by 3.4 million barrels per day in 2022, reaching 99.7 million barrels by the end of next year.
Translation by Giles Foster
