International Energy Agency (IEA), the developed market watchdog for the global energy market has warned in a new report, which is available here, https://www.iea.org/newsroom/news/2017/march/global-oil-supply-to-lag-demand-after-2020-unless-new-investments-are-approved-so.html that the oil supply would struggle to keep pace with the increase in demand by the end of this decade or in the next one.  Here are the key highlights,

• The demand and supply trends are pointing to a tight oil market ahead. The agency’s medium-term oil market report, which is available here, http://www.iea.org/bookshop/740-Market_Report_Series:_Oil_2017, forecasts that the spare oil production capacity would decline to the lowest level in 14 years.
• It highlights the increase in the oil production in countries like the United States, Canada, and Brazil but forecasts for it to decline if the record slump in investments over 2015 and 2016 is not reversed. This is the main theme behind the forecast.
• IEA forecasts that global oil demand would cross 100 million barrels per day by 2019 and reach 104 million barrels per day by 2022. Developing countries, especially in Asia would contribute largely to the growth in demand.
• According to the report, the electric vehicle will have limited impact on oil demanded by the transportation sector.
• On the supply side, the majority of the production growth would come from the United States, where supply growth is expected to reach 1.4 million barrels per day by 2022 if the price remains around $60 per barrel.
• Within OPEC, the majority of the growth in production would come from low-cost producers like Iraq, Iran, and the UAE, while it would decline for Nigeria, Algeria, and Venezuela.
• Additional crude oil exports likely to be higher from Brazil and Canada, than the Middle East.

WTI is currently trading at $52.8 per barrel and Brent at $55.6 per barrel.