IEA: Oil demand growth at lowest in years

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IEA: Oil demand growth at lowest in years

Due to the increasing trade concerns and global recession fears, the International Energy Agency (IEA) on Friday cut its estimate for global oil demand growth. In report, the agency said it now forecasts oil demand growth to reach 1.2 million barrels per day (b/d) in 2019, a downward revision of 100,000 b/d from the previous report. “A clear message from our first look at 2020 is that there is plenty of non-OPEC supply growth available to meet any likely level of demand, assuming no major geopolitical shock, and the OPEC countries are sitting on 3.2 million b/d of spare capacity,” the IEA report said. “This is welcome news for consumers and the wider health of the currently vulnerable global economy, as it will limit significant upward pressure on oil prices. However, this must be viewed against the needs of producers particularly with regard to investment in the new capacity that will be needed in the medium term.” The report also emphasized that the supply concerns still exist, stating that on Thursday oil prices initially increased by 4% on news of the attacks on two tankers in the Gulf of Oman, before easing back slightly.