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Head of energy agency says non-OPEC oil output will rise in 2019, boosting the oil price but there could be temporary glut
Gas price relief on the horizon as global oil supply picks up, says IEA
Gas prices could soon fall in some parts of the world, the head of the oil industry watchdog has said, as he welcomed a rise in global production despite geopolitical turmoil.
The International Energy Agency (IEA) said OPEC’s output growth remained slow and production from non-OPEC nations was likely to rise again in 2019, pushing up the price of oil.
“It looks like next year could bring some relief to consumers – more so than this year,” IEA chief Fatih Birol told Reuters in an interview on Tuesday.
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The Organisation of the Petroleum Exporting Countries (Opec) – which is dominated by Saudi Arabia and other major oil exporters – agreed in June to boost output by returning to 100% compliance with a supply-limiting deal reached in 2016.
The US administration’s decision to leave the Paris climate deal, a fight against Russia and other oil producers including Iran and Venezuela and a dispute in Libya are expected to curb growth in global oil demand, the Paris-based agency said.
But Birol said it looked as if non-Opec production would rise again, with supply growing about 1.3m barrels per day next year and by 800,000 barrels per day in 2020.
The IEA said its estimate was based on an expectation of “continued geopolitical uncertainties and related uncertainty in terms of geopolitical risks”, a reference to possible disruptions to production from Iran and Venezuela, which are still subject to sanctions.
The agency said average global oil prices were likely to average $78 (£59) a barrel next year, slightly higher than its previous forecast of $78.21 a barrel in January.
It added that its estimates “remain subject to any potential increase in price” as a result of possible output increases from Opec.