Energy agency says oil demand growth down, stockpiles up

Oil price competition in Europe is set to intensify when Iranian crude returns to the market after sanctions on its nuclear program are lifted, the global Energy Agency said.

Teddy Sloup, senior market analyst at iitrader.com LLC in Chicago, said traders on Tuesday had been targeting a technical level $43.50 a barrel and when Us crude failed to break lower the market bounced, although it would likely struggle to hold gains.

Benchmark USA crude futures were at $41.47 a barrel early on Friday, down 28 cents from Thursday, when prices tumbled 4% on the back of rising United States stocks. Brent crude futures that is traded internationally stayed around $44 per barrel dropping six cents.

Developed countries have continued stockpiling oil and commercial inventories in OECD nations now stand at a record 3 billion barrels, the IEA said.

Fossil fuel subsisdies were “public enemy number one” to renewable energy industry growth, said the IEA in response to the report from the Overseas Development Institute.

Low consumer prices has seen energy demand rebound, with the IEA expecting demand to reach a five-year high in 2015.

Global oil demand growth has not been fast enough to soak up the excess in supplies and analysts say a rebalancing of the supply-demand situation is needed for a sustained uptick in prices.

The government report also showed that total oil production rose by 25,000 barrels to 9.185 million barrels a day.

Oil prices rose on Tuesday, snapping a four-day losing streak triggered by oversupply concerns.

The IEA added that top oil exporter Saudi Arabia, which led OPEC’s decision past year to maintain the group’s official production ceiling despite the collapse in oil prices, is showing no sign of reversing its policy to defend its market share instead of the price. The EIA’s weekly update on natural-gas supplies will be released on Friday, a day late because of Wednesday’s holiday.

Nymex reformulated gasoline blendstock for December-the benchmark gasoline contract-fell to 1.2718 cents a gallon from 1.2731 cents.