• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 39 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 13 hours Solving The Space Problem For America’s Solar Industry
  • 56 mins Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 20 hours Investment in renewables tanking
  • 13 hours How Far Have We Really Gotten With Alternative Energy
  • 5 days If hydrogen is the answer, you're asking the wrong question
  • 5 days "Mexico Plans to Become an Export Hub With US-Drilled Natural Gas" - Bloomberg - (See image)
Will China’s Oil Demand Disappoint This Year? 

Will China’s Oil Demand Disappoint This Year? 

China is expected to account…

Japan's Efforts To Reduce Its Reliance On LNG

Japan's Efforts To Reduce Its Reliance On LNG

Japan's imports of LNG continue…

ExxonMobil: New Fracking Technology Can Double Oil Output

ExxonMobil: New Fracking Technology Can Double Oil Output

But shale giant ExxonMobil Corp.…

Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

More Info

Premium Content

IEA: U.S.-China Trade Row Could Dampen Oil Demand Growth

OPEC is very close to achieving its mission to draw oil inventories down to their five-year average, but the ongoing U.S.-China trade spat is a risk to oil demand growth expectations this year, the International Energy Agency (IEA) said in its Oil Market Report on Friday.

The Paris-based agency kept its global oil demand growth estimate unchanged from last month’s report—at 1.5 million bpd for this year.

“However, there is an element of risk to this outlook from the current tension on trade tariffs between China and the US,” the IEA noted.

The trade dispute is “introducing a downward risk to the forecast,” said the agency which sees oil demand growth possibly dropping by around 690,000 bpd if global economic growth were reduced by 1 percent on the back of widespread increase in trade tariffs.

“Oil demand would suffer the direct impact of lower bunker consumption and lower inland transportation of traded goods, reducing fuel oil and diesel use,” said the IEA.

On the supply side, the agency continues to expect non-OPEC growth unchanged at 1.8 million bpd, with the U.S. production growth also unchanged from the previous report, at 1.3 million bpd year on year. Yet, there is concern about takeaway bottlenecks in Midland, Texas and in Canada, and those could widen the discounts of local grades to the international benchmarks, according to the IEA. Related: The Six Factors Driving Oil Markets In 2018

OECD commercial stocks—OPEC’s current measure of the success of its production cut deal—dropped by 26 million barrels in February and were just 30 million barrels above the five-year average at end-February.

“The average could be reached by May, on the assumption of tight balances in 2Q18. Product stocks are already in deficit,” the IEA said.

“With markets expected to tighten, it is possible that when we publish OECD stocks data in the next month or two they will have reached or even fallen below the five-year average target. It is not for us to declare on behalf of the Vienna agreement countries that it is ‘mission accomplished’, but if our outlook is accurate, it certainly looks very much like it,” the agency said.

Recent reports have it that OPEC is considering ‘moving the goalposts’ on the deal, instead using seven or more years of average to measure the success of the cuts. Most proposals to change the current metric of assessing the success of the pact would shift the inventory goal further out in time.

ADVERTISEMENT

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment
  • Kr55 on April 14 2018 said:
    People funding the IEA demand any mass firings of their employees yet? Or do they enjoy funding an org that is just wrong all the time?

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News