Yesterday, the International Energy Agency’s (IEA) most recent oil market report, which highlighted disruptions in the Red Sea region and presented a more positive picture for demand growth, caused crude oil to see a notable jump of 2.48%, closing at 6,742. To boost market optimism, the IEA revised its demand growth predictions for 2024 and downgraded its projection for non-OPEC supply.
Furthermore, the forecast by Russia of higher crude oil exports as a result of unscheduled refinery maintenance contributed to the price support. The International Energy Agency (IEA) reported that global oil demand would increase by 1.3 million barrels per day (bpd) in 2024, up 110,000 bpd from the previous month’s estimate, despite disagreements between OPEC and the IEA over long-term demand outlooks and supply investment requirements.
This prognosis shows a tightening of the supply-demand balance, with the prospect of a minor supply deficit this year, driven in part by OPEC+ production cutbacks. However, it is not as optimistic as OPEC’s forecast of a 2.25 million bpd demand rise.
The number of barrels at sea grew as a result of lengthier routes being used for trade, as the IEA pointed out, due to impediments to shipping in the Red Sea. The market’s uncertainty was exacerbated by this geopolitical tension, which supported the optimistic outlook for crude oil prices.
