Economics
Oil Glut to Stay in 2016 as IEA Sees Slower Demand Growth
- Demand outlook `markedly softer' in 2016 on weaker growth
- Oil price erases gains in New York after agency's report
Is the Crude and Commodities Relief Rally for Real?
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Global oil markets will remain oversupplied next year as demand growth slows and Iranian exports are poised to recover with the lifting of sanctions, the International Energy Agency said.
While supplies outside OPEC will decline in 2016 in response to lower prices, demand growth will ease from this year’s five-year high amid a weaker outlook for the world economy, allowing the crude surplus to endure, the IEA predicted. Iran could swell the glut if restrictions on its sales are removed with the completion of a nuclear accord, while Iraq has replaced the U.S. as the biggest source of new supplies as its output reaches record levels.