The International Energy Agency (IEA) has significantly reduced the forecast of world oil consumption in 2015 and expects further reduction of prices.
In its monthly report IEA forecasts that in 2014 the consumption will grow by 700,000 barrels a day and next year – by 1.1 million up to 93.5 million barrels a day.
“The growth of consumption has, possibly, reached the lowest point. Although the economic forecasts reduce, this year IMF has three times reduced its forecasts and it still expects restoration of economy, though it will be a slower and more unstable process, than it was earlier supposed,” reads the report.
“Reduction of prices is caused both by supply and demand. One will, probably, need further reduction of prices to reduce supply and increase demand,” write the analysts of the Agency.
According to IEA, in 2015 deliveries from the non-OPEC member-states will increase by 1.3 million barrels a day, demand in OPEC oil will total 29.3 million barrels a day, down 200,000 the Agency’s September forecast. In September 2014 OPEC production increased up to 13-month peak of 30.66 million barrels a day with the limitation of 30 million.
IEA emphasized Saudi Arabia’s intention to keep the market share at the expense of increase in production and reduction of prices.
“Having reduced the prices for four months running, Er Riyad has firmly decided to stand up for its part of a more competitive Asian market,” reads the report.