Oil deficit expected Global oil markets will swing from surplus to deficit in the first half of 2017 as the Organisation of Petroleum Exporting Countries (Opec) and other producers follow through on an agreement to cut supply, according to the International Energy Agency (IEA). Oil stockpiles will decline by about 600 000 barrels a day in the next six months as curbs by OPEC and its partners take effect, said the agency, which had previously assumed inventories wouldn''t drop until the end of 2017. Russia, the biggest producer outside OPEC to join the deal, will gradually implement the full reduction it promised, according to the IEA. Oil has gained more than 16 percent since Opec agreed on November 30 to trim output for the first time in eight years, an accord expanded on December 10 with the participation of 11 non-members including Russia and Kazakhstan.
“Before the agreement among producers, our demand and supply numbers suggested that the market would re-balance by the end of 2017,” the Paris-based agency said in its monthly market report. “If Opec promptly and fully sticks to its production target” and other producers cut as agreed, “the market is likely to move into deficit in the first half of 2017.”
BLOOMBERG