• Oil glut set to ease this year: IEA

    A global oil glut that hit energy companies hard but meant cheap prices for consumers is set to ease by the end of this year, the International Energy Agency (IEA) said on Thursday. However, the agency said any potential production freeze agreed by leading oil producers, who are due to meet in Qatar on Sunday, would only have a “limited” impact on supplies. Ahead of the highly anticipated Doha talks, the 29-nation IEA said the oil market, which for months has been depressed by a vast oversupply, is expected to practically balance out in the second half of the year.

    Prices shot to 2016 highs this week and are now well over US $40 a barrel after plummeting below US $30 early in the year. They are nevertheless far below the US $100-a-barrel mark of mid-2014. The IEA said in its monthly oil market report that it still anticipates “steady oil demand growth and falling non-OPEC supply”, referring to producers outside of the Organization of the Petroleum Exporting Countries (OPEC).

    Expectations that the Doha meeting will agree to freeze output have helped buoy prices recently after reports that state OPEC kingpin Saudi Arabia and non-OPEC producer Russia had reached a consensus on freezing output, boosted hopes of a wider deal. “We cannot know the outcome but if there is to be a production freeze, rather than a cut, the impact on physical oil supplies will be limited.” 

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