DTN Oil Update
Oil Prices Soften on Global Surplus Forecasts
VIENNA (DTN) -- Oil prices slipped Wednesday morning following the newest supply and demand growth forecasts published by the International Energy Agency. Given the pace of OPEC production hikes, solid non-OPEC output growth, and sluggish demand growth, the IEA called for an even larger oil surplus by year end in its latest oil market report published today.
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NYMEX-traded WTI for September delivery fell $0.17 to trade near $63.00 bbl, and ICE Brent for October delivery slid $0.11 to $66.01 bbl.
September RBOB gasoline and ULSD futures both advanced by $0.0019 to $2.0763 and $2.2460, respectively.
The U.S. Dollar Index softened by 0.287 points to 97.640.
The report contained the fifth consecutive downward revision to global oil demand growth expectations, to 680,000 bpd in 2025 and 700,000 bpd in 2026. Simultaneously, global production growth is expected to outpace demand growth even more, leading the agency to expect an even larger oil surplus by the end of the year.
The Energy Information Administration similarly revised higher its oil surplus expectation for 2025 on the back of higher OPEC and non-OPEC production by close to 600,000 bpd in the latest short-term energy outlook published Tuesday.
Wednesday's IEA report also highlighted global inventories growing for a fifth consecutive month in June, to an almost four-year-high of 7.836 billion barrels, despite unchanged global production.
The American Petroleum Institute on Tuesday reported commercial crude oil inventories growing by 1.5 million bbls and distillate stocks by 300,000 bbls last week, adding to price pressure. Official U.S. oil inventory data from the Energy Information Administration is scheduled for 10:30 a.m. EDT release today.