IEA expects higher oil demand and lower non-OPEC supply

The oil market is continuing to see alternating gains and losses: prices increased yesterday but are weaker again today, which points to a certain disorientation among market participants. 

US crude oil stocks rose by 2.6 million barrels last week, partly because of a lower rate of crude oil processing that lower imports were unable to offset. Crude oil production fell to its lowest level since early January despite oil production in Alaska correcting the previous week's decline following the completion of maintenance work. 

This can be explained by the downward revision of the monthly production estimate which has now also been factored into the weekly data. The International Energy Agency has once again raised its forecast for global oil demand and now envisages an increase of 1.7 million barrels per day this year. 

"Demand looks set to grow by a further 1.4 million barrels per day in 2016. By contrast, non-OPEC supply is expected to decline by 500,000 barrels per day in 2016 because of falling US oil production, while the call on OPEC will increase to 31.3 million barrels per day in response", says Commerzbank.