IEA Becoming More Bullish on Demand

In this interview given to Tom Mackenzie from Bloomberg Daybreak Europe, Dr. Carole Nakhle, CEO of Crystol Energy, shares her view on the discrepancies in oil market outlooks.

Dr Carole Nakhle shares her view on the discrepancies in oil market outlooks on Bloomberg

Key takeaways:

– The International Energy Agency (IEA) has constantly revised its forecasts for oil demand in 2024 upwards, in its monthly oil market reports (OMR) published since the beginning of the year, inching closer to the bullish OPEC’s forecast of 2.2 million barrels a day (mb/d) though the difference between the two agencies remain notable (around 1 mb/d).

– One notable difference between the IEA’s own reports is that in its February 2024 OMR the agency indicated that growth between oil supply and demand in 2024 would be balanced only to change that to a deficit in the March OMR. However, the latter is based on the assumption that OPEC+ would extend its cuts for the rest of the year.

– While onshore US inventories declined recently, there is around 1.9 billion barrels of oil ‘on water’, as tankers take longer voyage to avoid the Red Sea.

– The demise of US shale oil has been predicted many times only to be proven wrong.

– China remains the wild card in terms of oil demand growth given that the country is facing structural problems that won’t dissipate overnight.

Related Analysis

Oil markets: Relative stability amid geopolitical strife“, Dr Carole Nakhle, Feb 2024

Asia’s energy market: The new global epicenter“, Dr Carole Nakhle, Dec 2023

A rising China is reshaping global energy markets“, Dr Carole Nakhle, Nov 2023

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Is There a Geopolitical Risk Premium in the Oil Price Right Now?“, Dr Carole Nakhle, Feb 2024

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