EIA: Global Oil Oversupply Could Return in 2018

Oil barrel spigotThe U.S. Energy Information Administration lowered its crude-oil price forecast and raised its production outlook for 2018 in its latest Short-Term Energy Outlook, reports Oil & Gas Journal.

“EIA expects that supply growth from the US, Brazil, and members of the Organization of Petroleum Exporting Countries in 2018 will contribute to world oil inventories increasing by 100,000 b/d in 2018, with the largest builds expected in that year’s second quarter. EIA also forecasts that implied global petroleum and liquid fuels inventories will decline by 200,000 b/d in 2017 and then increase by an average of 100,000 b/d in 2018,” according to the journal.

The agency’s forecast assumes OPEC extends its cuts beyond March 2018, “but that noncompliance, which begins to grow in late-2017, increases somewhat in second-half 2018. Without a further extension of the OPEC agreement, EIA would expect larger inventory builds in 2018 than are included in this forecast.”

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