Investment Manager Reveals Shocking Truth About Oil Demand Exceeding Supply
In a surprising turn of events, global oil demand is surpassing supply despite previous warnings from organizations like the International Energy Agency (IEA) about a potential peak in demand. The Energy Information Administration reported that in June 2024, global oil demand reached 103.35 million barrels a day, while production lagged behind at 102.85 mbpd.
The American Petroleum Institute’s recent report also showed a bearish trend with an unexpected increase in gasoline supplies and crude oil supplies. This unexpected supply deficit may continue to widen in the coming years, contrary to expectations of an oil glut.
Despite concerns about a market downturn and declining demand in China, oil demand is still on the rise. Rapid growth in demand from India has helped offset the decrease in Chinese demand. China’s daily crude oil imports hit a low in July, while India’s demand soared to record highs.
The US, the largest oil consumer globally, has seen an increase in demand, surpassing previous forecasts. The EIA raised its 2024 US oil demand forecast and left the world oil demand growth forecast unchanged.
Criticism of the IEA’s forecasting abilities has been ongoing, with concerns raised about its accuracy compared to OPEC’s predictions. While the IEA anticipates a peak in global oil demand in 2029, OPEC expects demand to keep rising.
Investors should be cautious in relying solely on the IEA’s projections, as a potential miscalculation could have significant economic repercussions. Despite geopolitical tensions, stability in the stock market and supply constraints in the oil industry are providing support.
In the market, companies are considering production cuts to prevent a natural gas glut, following a significant drop in prices. Major US natural gas producers are preparing for further cuts in the second half of 2024, as per reports from Reuters.
Overall, the unexpected imbalance between oil demand and supply highlights the complexity of the global energy market and the importance of staying informed about industry trends for making sound investment decisions.