The worldwide oversupply of oil may go on for at least six months longer than expected as demand slows and supply continues to rise, the International Energy Agency (IEA) said.
This will make the oil glut linger through at least the first half of the year, the agency’s monthly report said.
It is still a big question if the world oil market will return to balance. Current oil prices are above $45.
“However, the opposite now seems to be happening,” it said. “Demand growth is slowing and supply is rising.”
Key drivers on demand growth China and India are now “wobbling,” while a slowdown in the United States and economic concerns in other countries have affected the development of the oil glut.
Speculations of a possible production freeze aimed at supporting prices may trigger, being agreed between Norway and Russia in a meeting this month.
The IEA had earlier seen the end of oil oversupply in the latter part of 2016.
Currently, global oil demand is now projected to grow by 1.3 million barrels a day (mb/d) to 96.1 mb/d in 2016, a report from Agence France-Presse said.
The IEA also slimmed its demand growth for 2017 by 200,000 per day, to 97.3 mb/d