|
 The agency also said in its Medium Term Oil Market report that oil
prices, which slid from $115 a barrel in June to a near six-year low
close to $45 in January, would likely stabilize at levels
substantially below the highs of the last three years.
Oil prices deepened their decline after the Organization of the
Petroleum Exporting Countries in November shifted strategy and
declined to cut its own output, choosing to retain market share that
has been eroded by rival supply sources such as U.S. shale oil.
But IEA Executive Director Maria van der Hoeven, launching the
report in London, said while OPEC may win back some customers while
prices are low, it would not regain the market share it held before
the 2008 financial crisis.
"This unusual response to lower prices is just one more example of
how shale oil has changed the market," she said in a statement.
"OPEC's move to let the market rebalance itself is a reflection of
that fact."
The report said supply growth of U.S. light, tight oil (LTO) will
initially slow to a trickle but regain momentum later, bringing its
production to 5.2 million barrels per day (bpd) by 2020.
Total U.S. supply increases by 2.2 million bpd to 14 million bpd in
2020, with most of the expansion due to LTO.
"The price correction will cause the North American supply 'party'
to mark a pause; it will not bring it to an end," said the IEA,
which advises industrialized countries on energy policy.
TOP LOSER?
The outlook for output in Russia, one of the world's top producers,
is less optimistic.
"Russia, facing a perfect storm of collapsing prices, international
sanctions and currency depreciation, will likely emerge as the
industry's top loser," it said, forecasting production looked set to
contract by 560,000 bpd to 10.4 million bpd from 2014 to 2020.
Partly as a result of lower non-OPEC output, the IEA predicted
global demand for OPEC crude will rise in 2016 to 29.90 million bpd,
after holding at 29.4 million bpd this year.
Reflecting the rise of shale and slowing demand in the West, OPEC's
market share has fallen to less than 30 percent this year from more
than 40 percent in 2008, the IEA said.
[to top of second column] |
Other forecasters see lower prices and investment cuts to have a
larger impact on non-OPEC supply. OPEC itself, in a monthly report
on Monday, forecast demand for its oil this year would be higher
than expected as its strategy to not prop up prices hits other
producers.
The IEA's latest report contrasts with its previous medium-term
outlook published in June, which had higher oil demand forecasts and
highlighted risks to supply such as from violence Iraq.
Now, the IEA expects global growth in oil demand to accelerate to
1.13 million bpd in 2016 from 910,000 bpd in 2015. Still, it saw the
price decline as having a marginal impact on demand growth for the
rest of the decade.
"Expectations of global economic growth have been repeatedly revised
downwards in the last six months despite steeply falling prices,
slashing prior forecasts of oil demand growth for the rest of the
decade by about 1.1 million bpd," the report said.
Low prices, slowing demand and abundant supply have boosted the
volumes of oil held in storage, weighing on prices. The IEA sees
this build-up halting as early as mid-2015 and the market starting
to tighten afterwards.
But oil could face further weakness before that happens, the agency
said in a separate monthly report also issued on Tuesday which
forecast stocks in OECD nations may by mid-year come close to
revisiting the record high reached in 1998.
"Despite expectations of tightening balances by end-2015, downward
market pressures may not have run their course just yet," the
monthly report said.
(Additional reporting by David Sheppard and Ron Bousso; Editing by
William Hardy and David Evans)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |
