June 13, 2018 / 9:26 AM / 2 months ago

IEA sees squeeze on OPEC spare capacity if Iran, Venezuela production shrinks

LONDON, June 13 (Reuters) -

* Under a scenario of Venezuelan and Iranian oil production falling by a combined 1.5 million barrels per day by end 2019, OPEC spare capacity (excluding Iran) could shrink to 2.5 million bpd if the group decides to compensate for the shortfall, the Paris-based International Energy Agency said

* “That would be the lowest level since the end of 2016, when OPEC produced at full tilt ahead of the Vienna Agreement, building up substantial inventories,” the IEA said

* The IEA sees spare OPEC capacity at 3.4 million bpd in May, with Saudi Arabia accounting for 60 pct

* The IEA expects OPEC capacity to rise by 240,000 bpd from Q4 2018 to 35.1 million bpd, with the Middle East accounting for nearly all the growth

Reporting by Ahmad Ghaddar; editing by Jason Neely

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