Oil supplies up as crude prices rise

International Energy Agency forecasts oil demand to rise despite projected increase in oil supplies and prices

International Energy Agency forecasts oil demand to rise despite projected increase in oil supplies and prices

ANKARA -  Global oil supplies rose 700 thousand barrels a day to 92.1 million barrels month‐on‐month in April, with more than half of the increase coming from OPEC producers, the International Energy Agency said Thursday, as crude oil prices also rose on fears of supply disruptions due to the crisis in Ukraine.

Compared to 2013, global supplies were up by 820 thousand barrels per day. OPEC's production, while it was up in April, was down 850 barrels per day for the year -- but that decline was more than offset by the growth in production of 1.8 million barrels per day by countries that do not belong to the cartel. The figures were included in the International Energy Agency's Oil Market Report for May.

Total non-OPEC crude production in April rose by approximately 285 thousand barrels per day month on month, boosted primarily by increases in the U.S., the U.K. and China. OPEC crude oil supplies reached about 30 million barrels per day in April, led by higher outputs from Iraq, Saudi Arabia, Kuwait and Algeria. 

Oil prices also rose marginally month‐on‐month in April. The rise was attributed largely to continued tension between Russia and Ukraine. The two most important indicators of oil prices both were up: The New York Mercantile Exchange West Texas Intermediate -- a grade of crude oil used as a benchmark in oil pricing -- gained $1.52 per barrel to an average $102.03. ICE Brent -- Intercontinental Exchange Brent, another benchmark product -- rose by $0.34 per barrel to $108.09.

Global energy markets are worried by the possibility that supplies could be disrupted by an escalation of the crisis in Ukraine. They are worried, as well, by domestic turmoil in countries such as Nigeria, Venezuela and South Sudan. 

The International Energy Agency revised its forecast for global oil demand for 2014 upwards by 65 thousand barrels per day to 92.8 million barrels per day. Stronger‐than‐expected demand in the U.S. in February and revisions for Japan, Germany and the U.K. contributed to the revision.

The supply from OPEC countries is expected to remain at around the 30 million barrels per day production ceiling, as OPEC ministers will gather in Vienna on June 11 to review the outlook for the remainder of 2014.

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