Global oil supplies are growing rapidly, as record output from Saudi Arabia, Russia and the US more than offsets declines from Iran and Venezuela, the International Energy Agency said in its Oil Market Report.
‘October output was up 2.6 million barrels per day (mb/d) on a year ago. Non-OPEC output will grow by 2.4 mb/d this year and 1.9 mb/d in 2019,” said the report.
“Today, the Big Three, Russia, Saudi Arabia and the United States, all see output at record levels. Total non-OPEC production in August, the latest month for which we have consolidated data, was 3.5 mb/d higher than a year ago, with the United States contributing an extraordinary 3.0 mb/d. Russia's crude output has hit a new record of 11.4 mb/d, with companies suggesting that they could produce even more.”
This is while OPEC crude output rose 200 kb/d in October to 32.99 mb/d, up 240,000 b/d on a year ago, according to IEA estimates.
“Losses of 0.4 mb/d from Iran and 0.6 mb/d from Venezuela were offset by increases from others. The call on OPEC crude falls to 31.3 mb/d in 2019, 1.7 mb/d below current output,” said the agency.
IEA believes that although the oil market appears to be more relaxed than it was a few weeks ago, and there might be a sense of "mission accomplished" that producers have met the challenge of replacing lost barrels, such is the volatility of events that rising stocks should be welcomed as a form of insurance, rather than a threat.
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