IEA: Oil Markets Heading Into Unprecedented Uncertainty

 Oil markets are entering an unprecedented period of uncertainty due to geopolitical instability and a fragile global economy, the head of the International Energy Agency said on Tuesday.Concerned about an emerging production overhang similar to the one that led to a price slump in 2014, the Organization of the Petroleum Exporting Countries is pushing for a supply cut of 1 million to 1.4 million barrels per day (bpd) The United States restored sanctions targeting Iran’s oil sector in early November, cutting the country’s crude exports by close to 1 million bpd from a summer peak. Although Washington has pledged eventually to halt all of Iran’s global sales of crude oil, for now it has said eight buyers - China, India, South Korea, Japan, Italy, Greece, Taiwan and Turkey - can continue imports without penalty. “The U.S. decision on the Iranian sanction waivers took some of the players in the market by surprise,” the IEA’s Fatih Birol said in an interview on the sidelines of a conference organized by Norwegian energy company Equinor. 

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Oil traded near $57 a barrel as traders assessed OPEC’s plans to cut production..Calm down OPEC

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Few days ago, IEA said that they now expect a dramatic oil supply crunch in the early 2020s, careful reading and  US shale production cannot keep up with the depletion...

This surely reflects a correct perception of future demand, otherwise more effort would go into the necessary exploration and development. In other words, oil and gas companies are perfectly aware of what's coming.

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(edited)

OPEC will cut the supply the market wants and cede market share to the supply the market doesn't want.

Edited by Pavel

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Since when has the price of oil NOT been volatile?

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Not uncertain. On its way out.

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Since when has the price of oil NOT been volatile?

When the US can produce and refine 18 million bbls of crude oil a day, the industry can define it's price point.  Then there will be a stable price, but will that ever happen - doubt it.  If your saying crude is on the way out I'd say you're in wishful thinking territory.

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48 minutes ago, Jo Mack said:

Since when has the price of oil NOT been volatile?

When the US can produce and refine 18 million bbls of crude oil a day, the industry can define it's price point.  Then there will be a stable price, but will that ever happen - doubt it.  If your saying crude is on the way out I'd say you're in wishful thinking territory.

If you think in the region of 6 yrs away we don't hit peak demand I'd say that's wishful thinking.

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