IEA Warns of Supply Shortage, Oil Prices Rise

Deep News05-13 22:40

Crude oil futures have resumed their upward trend after the International Energy Agency indicated that the oil market is expected to remain in a state of shortage until the final quarter of this year.

Brent crude rose by 0.1% to $107.93 per barrel, while West Texas Intermediate futures increased by 0.4% to $98.91 per barrel.

The IEA now forecasts that global oil demand will contract by 420,000 barrels per day this year, revising its earlier projection of an 80,000 barrels per day decline. OPEC has also lowered its demand growth estimate from 1.38 million barrels per day to 1.17 million barrels per day.

"Oil is in a race against time," said Alex Kuptsikevich of FxPro. "The longer the Strait of Hormuz remains blocked, the greater the likelihood of sustained price increases for both Brent and West Texas Intermediate crude in the longer term."

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