Oil climbs after IEA signals tighter market
Make us a preferred source
Make us a preferred source on Google
The news: Oil prices climbed to a four-month high as the International Energy Agency raised its view on oil demand growth and predicted a tighter market this year.
The numbers: In its latest monthly report, the IEA forecast demand will rise by 1.3 million barrels per day (bpd) in 2024, up 110,000 bpd from its previous estimate. Oil demand had risen 2.3 million bpd last year.
It prompted brent crude futures to rise 1.7% to USD85.42 a barrel, while US West Texas Intermediate (WTI) crude gained 1.9% to USD81.26 a barrel, their highest closing levels since early November.
The context: The IEA has now raised its 2024 oil demand growth for the fourth time since November due to an an improved outlook for the US and increased supply to shipping vessels.
However, the energy watchdog also cut its 2024 supply forecast and now expects oil supply to rise by 800,000 bpd to 102.9 million bpd this year.
Houthi attacks that have disrupted Red Sea shipping have also weighed and the IEA warned that "the global economic slowdown acts as an additional headwind to oil use".
Earlier this month, the Organization of the Petroleum Exporting Countries plus (OPEC+) members agreed to extend voluntary oil output cuts of 2.2 million bpd into the June quarter.
