OIL & GAS MARKET WRAP

The Oil and Gas wrap provides the latest oil prices from commodity exchanges in New York and London, gives a summary of the main corporate and macroeconomic news impacting the price of oil, a barometer of the strength of global economy.

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Oil prices steady, IEA upgrades demand outlook

January 18 2013, 1:02pm
Oil prices steady, IEA upgrades demand outlook

Energy watchdog the International Energy Agency (IEA) today said that oil market 'looks tighter' than it had previously thought, as it upgraded it outlook on oil demand in 2013.

This comes as Chinese economic growth is set to beat the market's prior expectations and Saudi Arabia, the world's largest oil producer, began to limit its output.

Revising its guidance on 2012 it said that demand likely grew by nearly 1mln barrels a day (versus a prior 850,000 bpd estimate). According to the IEA global oil demand will be in the order of 30mln bpd in 2013 - some 100,000 barrels more than its earlier guidance.

Meanwhile the oil market had more immediate concerns on Friday - over the unfolding crisis at BP's In Amenas gas field in Algeria.

After peaking above the $111 a barrel marker overnight Brent Crude futures pulled back somewhat by midday, to change hands around $110.70. Meanwhile, America's West Texas Intermediary was changing hands at $95.50.

The precise situation on the ground in the remote location, in the Sahara, remains unclear though with BP now flying non essential staff from Algeria the oil market will be paying close attention.

The north African state is the world's fourteenth largest supplier to the global energy markets. The In Amenas operation alone generates almost $4bln a year.

Experts are already claiming that the siege, and the instability it represents, could be the final straw for certain quarters of the oil and gas community - which has a strained history in the country.

 


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