Jackie Forrest and Peter Tertzakian discuss the key takeaways from the International Energy Agency’s (IEA) July Oil Market Report. The report shows that OPEC compliance levels dropped in June, however oil demand is predicted to come in strong in the second half of 2017 with the IEA raising their demand outlook for the full year. Additionally, May data is showing that OECD crude oil inventory levels outside of the US are starting to decline.
Even considering the extra OPEC barrels on the market, stronger demand should flip the oil market into a sizable shortfall in the second half of 2017. Signposts to watch in the coming months include OPEC production levels, OECD storage, and demand.