PARIS, September 12, 2013 (AFP) – An increase in output should help cushion oil markets seized by tension over a possible conflict in the Middle East, the IEA said Thursday, with emerging market nations facing difficulties due to their falling currencies. The slow pace of the global economy led the International Energy Agency to keep its forecast for oil demand growth for this year unchanged, while rising it slightly in 2014.
However a dip in supply by 770,000 barrels per day plus concerns a US strike on Syria over its suspected use of chemical weapons triggering a wider conflict sent oil prices up sharply.
The price of Brent crude has since dipped from a peak around $117 hit last month on possibilities of a diplomatic resolution to the standoff.
“But, while the geopolitical storms in the Middle East and North Africa have yet to pass, easing fundamentals look set to lessen the pressure somewhat on market participants – at least for the next few months,” said the IEA.
“Global crude supply – notwithstanding the Libyan problems – looks set for an upward jump in 4Q13, thanks to a heady mix of seasonal, cyclical, political and structural factors,” added the energy and oil strategic reserve monitoring arm of the Organisation for Economic Coop