London, United Kingdom | – Geopolitical tensions and the shaky economic recovery means there is little room for complacency in oil market in the next 12 months, the International Energy Agency warned Friday.
In its closely watched monthly oil market report, the Paris-based energy watchdog forecast rising demand growth and a steady increase in supply from non-Organization of the Petroleum Exporting Countries for 2015.
It said global demand for oil will accelerate to 1.4 million barrels a day from 1.2 million barrels a day this year, while oil supply from outside OPEC will increase by around 1.2 million barrels a day, continuing the trend of robust non-OPEC production.
However, the IEA warned that the risks associated with its 2015 demand forecast are “particularly high” due to the uncertain global economic recovery and geopolitical tensions in a host of countries, including Iraq, Libya, Nigeria and Venezuela, are adding to the macroeconomic uncertainties.
The same political issues in major oil-producing countries also pose a threat to oil supply, it said.
Iraqi production fell by 260,000 barrels a day last month after violence in the north forced the closure of the country’s largest refinery and cut output from the giant Kirkuk field to a trickle. Meanwhile, logistical issues and maintenance at Basrah cut output from Iraq’s southern fields by 160,000 barrels a day.
Increased supply from Saudi Arabia, Iran, Nigeria and Angola offset the decline in Iraq, leaving OPEC production broadly steady at 30 million barrels a day in June.