O world market of oil may be tighter than it seems, although the balance between offer e demand Pointing to a surplus, said the IEA (International Energy Agency) on Friday (11), as refineries increase processing to meet the demand for fuel from summer trips.
The IEA expects the global offer to increase by 2.1 million barrels a day this year, 300,000 BPD more than the previous forecast. World demand will increase by only 700,000 BPD, according to the IEA, which implies a considerable surplus.
Despite having made these changes, IEA said the increase in refinery processing rates to meet summer travel and the energy generation demand was making the market tighter, and that the latest increase in OPEC+ offer on Saturday did not have much effect.
“OPEC+ decision further accelerating the reduction in production cuts could not significantly move markets due to the tighter grounds,” the agency said in a monthly report.
“Price indicators also point to a tight physical oil market than suggested by the big surplus in our balance sheets.”
The comments are similar to the message broadcast earlier this week by the ministers and executives of OPEC countries and the heads of the main Western oil companies.
Production increases are not leading to higher stocks, which shows that markets are thirsty for more oil, they said.
As examples of price indicators that suggest a tighter market, IEA cited strong refining margins and the prize for which oil for immediate delivery is being negotiated in relation to later supply, a structure known as BackWardation.
