January 10, 2020 / 4:57 AM / 17 days ago

Ample supplies, weak global demand growth to cap oil prices in 2020: IEA

NEW DELHI (Reuters) - The global oil market is expected to be well-supplied in 2020 and demand growth could stay weak, keeping a lid on prices, the head of the International Energy Agency told Reuters on Friday.

“We are expecting a demand growth of slightly higher than 1 million barrels per day,” said the IEA’s executive director, Fatih Birol, adding that growth could remain weak, compared with historical levels.

There is also an implied surplus of 1 million bpd oil, ensuring that the global market is well supplied, he said.

“Non-OPEC production is very strong. We still expect production coming from, not just United States, but also Norway, Canada, Guyana, among other countries,” Birol said, referring to oil producers outside the Organization of the Petroleum Exporting Countries (OPEC).

“Therefore, I can tell you that the markets are, in my view, very well supplied with oil, and as a result of that, we see prices remain at $65 a barrel.”

Brent crude futures topped $70 a barrel after a U.S. air strike killed Iran’s top commander in Iraq last Friday, escalating tensions in the Middle East. But prices cooled quickly after the threat of war in the Gulf receded. [O/R]

Reporting by Nidhi Verma and Sudharshan Varadhan; Writing by Florence Tan; Editing by Clarence Fernandez

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