India takes centre stage in energy economy, to drive demand growth: IEA

Mae Love
November 14, 2017

Oil fell by more than $1 in morning trading in NY after the International Energy Agency reported that recent increases in the oil price and milder-than-normal weather had dampened demand growth.

A pump jack is seen at sunrise near Bakersfield, California October 14, 2014.

The Paris-based IEA revised demand growth down by 100,000 barrels per day (bpd) for both 2017 and 2018, for an increase of around 1.5m bpd this year, to 97.7m bpd, and 1.3m next, to 98.9m bpd, which could push the market back into a surplus in the first half of next year.

"However, if these problems do prove to be temporary, a fresh look at the fundamentals confirms the view we expressed last month that the market balance in 2018 does not look as tight as some would like, and there is not in fact a "new normal". And the IEA expects non-OPEC countries to boost output by 1.4 million barrels a day next year, doubling this year's production growth.

Compliance by the group with its joint 1.8-million-bpd output cut with 10 partners was 96 percent in October, the highest since the supply-reduction deal took effect in January. "Meeting this demand would require an overall investment of around $10.5 trillion across upstream, midstream and downstream operations" Opec Secretary-General, Mohammad Barkindo, said noting that the 2017 outlook was more positive than previous year, partly thanks to oil exporting nations' efforts to stabilise the market. The country is expected to account for 80 per cent of the increase in global supply over the same period.

5 arrested following officer-involved shooting, hospital disturbance
The DA said in a statement yesterday police were called to the scene for "possible gunshots" and came upon cars leaving the area. It is unclear what happened there, but Fall River Police say the arrests occurred "after a disturbance related to" the shooting.

Euro zone annual growth backs ECB's tapering move
The euro zone growth rate also exceeded that of Britain, which will leave the European Union in March 2019. This may provide some comfort after Italy was left out of the World Cup for the first time in 60 years.

Michigan State vs. Duke
That being said, Michigan State had a similar dominating start to the season with a 32-point victory over North Florida. This will be the seventh iteration of the Champions Classic, a two-game early season showcase event.

"Electric vehicles (EVs) are in the fast lane as a result of government support and declining battery costs but it is far too early to write the obituary of oil, as growth for trucks, aviation, petrochemicals, shipping and aviation keep pushing demand higher".

"Using a scenario whereby current levels of Opec [Organisation of the Petroleum Exporting Countries] production are maintained, the oil market faces a hard challenge in 1Q18 with supply expected to exceed demand by 0.6m bpd followed by another, smaller, surplus of 0.2m bpd in 2Q18".

The report suggested that over the next two decades, the global energy system would be reshaped by four major forces: the United States as it becomes global oil and gas leader, rapid deployment of renewables, growing share of electricity in the energy mix, and China's new economic strategy taking it on a cleaner growth mode.

IEA said it had cut its longer-term oil price projections from previous year, partly because of the falling cost of both renewable and conventional sources of energy, the worldwide push to tackle climate change and improve air quality and the boom in U.S. shale oil and gas output.

Growth is expected to accelerate to 1.4 million bpd in the last three months of this year, even though mild temperatures and rising prices will restrain demand, the IEA said.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER