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IEA sees less need for Opec crude in 2014 on US supply

Demand for crude from the Organisation of Petroleum Exporting Countries will be 29.2 million barrels a day or 1.3 million a day lower than the group’s current production levels, the IEA said on Thursday in its monthly market report. The impact of supply losses in Libya and threats to exports from the crisis in Syria will be softened as fading seasonal demand allows oil inventories to replenish, the Paris-based adviser to energy consuming nations said.

“Despite continued tensions, the recent tightening of oil market fundamentals — the broad bullish backdrop that has arguably heightened the oil market’s sensitivity to the Syrian threat — looks set to give way to somewhat easier conditions in the fourth quarter,” the IEA said.

Brent has recovered about 15 per cent from this year’s low on signs the global economy is recovering, and as conflict and political disturbance in the Middle East and North Africa curbs oil supplies.

The crude was at $111.62 a barrel on the ICE Futures Europe exchange in London as of 8:46 am local time.

The IEA raised forecasts for global oil demand in 2014 as the world economy recovers. Consumption will increase by 1.1 million barrels a day, or 1.2 per cent, to 92 million. That’s 70,000 barrels a day more than estimated last month.