Iea Pares Non-Opec Oil Output To 1.34m Bpd

The International Energy Agency (IEA) on Tuesday slashed its forecast for non-Opec oil supply increases this year by nearly a third but said world markets would still be over-supplied.

IEA also admitted that over the past two years, it had consistently overestimated projections for world oil supply. In a letter from the editor of its monthly report to subscribers, the Paris-based energy think-tank said that a thorough analysis of disaggregated data had led to a hefty reduction in its forecast for oil supplies in 1998 from non-Opec producers.

The West's energy watchdog cut its projected supply increase from non-Opec countries from 1.86 million barrels per day (bpd) to 1.34 million bpd, blaming a lack of drilling equipment, personnel and tight production deadlines.

 

But the slowdown in supply growth would do little to help markets badly affected by demand constraints imposed by the Asian financial crisis.

and warm winter weather in the Northern hemisphere, it added.

The agency said non-OPEC supply would probably exceed demand for at least the first half of 1998, adding more oil to storage facilities which, at the end of last year, were already at their fullest for two decades, barring 1994.

The report offered little cheer to OPEC members whose output ceiling increase in November last year triggered a 30 per cent slide in oil prices.

The IEA saw extra OPEC oil helping add 4,00,000 bpd to global production last month.