Oil prices rise on strong IEA, OPEC demand estimates
Oil prices rose as the IEA joined producer group OPEC in forecasting relatively strong growth in global oil demand this year, with price impetus also coming from disruption to US output and geopolitical risks in the Middle East.
Brent crude futures gained 37 cents, or 0.5%, to $78.25 a barrel by 1005 GMT while U.S. West Texas Intermediate crude futures rose 55 cents, or 0.8%, to $73.11, Reuters reported.
The International Energy Agency (IEA) now expects oil demand to grow by 1.24 million barrels per day (bpd) in 2024, up 180,000 bpd from its previous projection, its monthly report said. The agency cited improved economic growth and lower crude prices in the fourth quarter.
The Organization of the Petroleum Producing Countries (OPEC) had said on Wednesday that it expected demand growth of 2.25 million bpd this year, unchanged from its forecast in December. The producer group also said oil demand is expected to rise by a robust 1.85 million bpd in 2025 to 106.21 million bpd.
The IEA’s executive director, Fatih Birol, told the Reuters Global Markets Forum that he expects oil markets to be in a “comfortable and balanced position” this year despite Middle East tensions, rising supply and a slowing demand growth outlook.
Oil’s range-bound trading in recent days reinforces the narrative that investors are shrugging off concern that tankers may be at risk from attacks in the Red Sea, said Ehsan Khoman, analyst at bank MUFG.
In top oil-producing US state North Dakota, meanwhile, oil output fell by 650,000 to 700,000 bpd because of extreme cold weather, the state said.