Crude Oil: Rising U.S. production could give OPEC more breathing room. “OPEC revised its forecast for the call on OPEC in 2019 down by 270,000 to 31.8 million barrels per day due to the steep rise in non-OPEC supply. By contrast, OPEC production rose to 32.8 million barrels per day in September, despite falls in Iran and Venezuela,” Commerzbank wrote in a note. “Thus OPEC is currently producing roughly 1 million barrels per day more than will be needed next year, creating a substantial cushion for any further outages in Iran and Venezuela.”
In the short run, the IEA said that “expensive energy is back,” and it could threaten economic growth. Rising production from Saudi Arabia over the last few months leaves the market “adequately supplied for now,” the IEA said, although because the gains have come at the expense of spare capacity, the market is now suffering from some strain. Meanwhile, the IEA also downgraded its oil demand forecast for 2019 from 1.4 to 1.3 million barrels per day, citing emerging market weakness.
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