Oil slides after IEA warned of a supply deficit

Oil prices fell today, Friday, after the International Energy Agency warned that the production cuts announced by the producing countries in OPEC + may increase the oil supply deficit and harm consumers.

By 0820 GMT, Brent crude futures fell 10 cents, or 0.12 percent, to $85.99 a barrel. US West Texas Intermediate crude futures fell five cents, or 0.06 percent, to $82.11 a barrel.

According to “Reuters”, the two benchmarks are expected to record gains for the fourth week in a row, in light of calming fears of the banking crisis that occurred last month and the sudden decision to increase production cuts taken last week by the Organization of the Petroleum Exporting Countries (OPEC) and other producers led by Russia. , a group known as OPEC +.

On Thursday, OPEC pointed to the risks of lower oil demand in the summer due, among other things, to a production cut of 1.16 million barrels per day.

IEA said in its monthly report on oil issued today, Friday, that it expects a decrease in global oil supply by 400,000 barrels per day by the end of the year, noting an expected increase in production of one million barrels per day from outside OPEC +, starting in March, compared to 1.4 million. Barrels per day will be reduced by the producing countries in the group.

But it said that at the same time, global oil demand is set to rise by two million barrels per day in 2023, to a record level of 101.9 million barrels per day.

The dollar index closed at the lowest level since the beginning of February, after the release of consumer and producer price data in the United States this week, which reinforced expectations that the Federal Reserve (the US central bank) is nearing the end of the interest-raising cycle.

A weaker dollar makes oil denominated in the greenback cheaper for investors holding other currencies, boosting demand.