Supply/Demand deficit in 1st half of next year… IEA

The IEA is looking for a supply/demand deficit of 600,000 barrels per day in the 1st half of next year… From the Financial Times: https://www.ft.com/content/ca885818-c115-11e6-9bca-2b93a6856354?accessToken=zwAAAVj4_K34kdPKiFgYwRUR5tObyiuTpoVjVA.MEUCIQDd6mmz0dLu3K9cBYo1ePi5KNrVGi76uJbRZgi4DXz-SgIgLM-SHpf7b3smOluwtoux90r13K6OqZpiSkt2KG-qp7M&sharetype=gift

“The IEA’s widely followed monthly report marks the first major assessment of the balance between supply and demand in the market since Opec first agreed to reduce production on November 30.

Previously the agency had forecast the market would remain oversupplied until at least the second half of 2017, with the prospect of the market remaining in surplus for a fourth straight year.

However, if Opec reduces supply and meet its new production target of 32.7 b/d and non-members deliver cuts of 558,000 b/d agreed on Saturday, the market will move into a deficit of 600,000 b/d in the first half of next year, the IEA said.”

 

Compliance is key going forward but the Times points to this:

“Shortly after the non-Opec cuts were announced at the weekend, Saudi Arabia’s energy minister Khalid al-Falih said his country was willing to cut even more than the agreed level of 10.06 mbpd.”