"Global oil supply may exceed demand" - Trade tensions, OPEC+ overproduction will affect the global market
Global oil supply could exceed demand by about 600,000 barrels per day this year, the International Energy Agency said in a monthly report.
This surplus could increase by another 400,000 barrels per day if OPEC+ extends the easing of production cuts and fails to curb overproduction against quotas, the Paris-based agency said.
The February oil market report had suggested a slightly narrower surplus of about 500,000 barrels per day, according to Reuters.
The agency cut its forecast for oil demand growth in 2025 by 70,000 barrels per day to about 1 million barrels per day. The growth is driven largely by Asia, particularly China's petrochemical industry.
The data highlights the task facing the OPEC+ group of producers to balance the oil market this year, as rising global trade tensions could dampen demand while supply continues to rise.
"Macroeconomic conditions supporting our oil demand forecasts deteriorated over the past month as trade tensions escalated between the U.S. and several other countries," the Energy Information Administration said, prompting it to revise its demand growth estimates.
In terms of supply, the report forecasts a doubling of global growth for 2025 compared to the growth rate in 2024, to about 1.5 million barrels per day, assuming OPEC+ maintains cut levels after the planned April easing.
The agency said OPEC could only add about 40,000 barrels of oil per day to the market after the reduction in cuts in April by Saudi Arabia and Algeria, as continued overproduction by other member states leaves no room for further growth.
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