Oil demand around the world is set to accelerate this year as economic situations improve – with supply set to outstrip demand despite record US shale output, a new report has found.
The monthly oil market report from industry watchdog the International Energy Agency warned oil consumption would increase by 1.3million barrels a day this year – 50,000 more than previously forecast.
The increase would require higher output from the OPEC group of countries, despite the IEA forecasting that US oil production will increase by more than 780,000 barrels.
“Global throughput in the quarter should grow 1.3mb/d, up from only 0.3mb/d in the last quarter of 2013, as contractions in Europe ease and new Chinese and Middle Eastern capacity ramps up,” the IEA said.
Oil demand rose by 135,000 barrels a day in the final quarter of 2013, as increased output in the US more than compensated for drops in China.
OPEC output in December increased, after four months of decline, with Saudi Arabia and the UAE leading the charge.
“Iraq was the only member to post a decline, though beleaguered Libya saw only a modest rise, amid government expectations of an imminent recovery in oil output,” the agency said.
Iran’s output was boosted amid diplomatic talks aimed at ending Iranian nuclear activity.
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