IEA lowers global oil supply estimate for 2024

Global oil supply in 2023 will be 101.9 million b/d, up from a month ago estimate of 101.8 million b/d, the International Energy Agency said, Report informs via Interfax.

The estimate for 2024 was lowered to 103.2 million b/d from 103.4 million b/d in the November forecast.

“US production growth continues to exceed expectations, with record production exceeding 20 million b/d, and since our June report, the total upward revision of US supply in the second half of 2023 will be about 700,000 b/d, mainly due to higher than expected operational efficiency and well productivity,” the IEA said.

The report said higher-than-forecast US inventories, as well as higher output in Brazil and rising Iranian production - coupled with slowing demand - prevented oil market conditions from tightening in the fourth quarter of 2023, as previously expected. An overall increase in production of 1.8 million b/d will take global supply in 2023 to 101.9 million b/d, the highest level ever.

While the US will account for two-thirds of non-OPEC+ production growth, the latter will reduce production by 400,000 b/d in 2023. As a result, the organization's share of the global market will drop to 51%, the lowest level since the creation of the alliance in 2016.

“US oil supply growth will slow to just 600,000 b/d next year, but it still ranks as the leading source of global growth and accounts for 45% of the 1.3 million b/d increase compared to countries not members of OPEC+ in 2024. Brazil and Guyana are also poised to set new records,” the agency added.