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The International Energy Agency (IEA) expects the return of an oversupplied oil market next year, despite the recent rollover of an OPEC-led pact designed to restrain any glut.
The energy agency said the “main message” of its closely-watched report was that oil supply in the first six months of 2019 had exceeded demand by 0.9 million barrels per day.
“This surplus adds to the huge stock builds seen in the second half of 2018 when oil production surged just as demand growth started to falter,” the Paris-based IEA said Friday.
Neil Atkinson, head of the oil industry and markets division at the IEA, told CNBC on Friday that in addition to the remainder of this year, the outlook for 2020 is also for “considerable oversupply because we are getting big growth from the United States and some other countries.”
“So, as far as the issue of re-balancing is concerned, as we say in the lead article in today’s report, re-balancing is still some way off,” Atkinson said.
OPEC and its allies, led by Russia, have kept 1.2 million barrels per day off the market since the start of the year.
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