Crude Oil Inventories Decline; Supply at 2018 Peak: IEA

OPEC headquarters in Vienna- last month the cartel agreed along with Russia to continue output curbs Wikimedia Commons

OPEC headquarters in Vienna- last month the cartel agreed along with Russia to continue output curbs Wikimedia Commons

Meanwhile, OPEC said world oil demand will grow by 1.53 million barrels a day in 2018.

The agency's forecast for global demand growth remains unchanged at 1.5 mb/d in 2017 (or 1.6 percent) and 1.3 mb/d in 2018 (or 1.3 percent). OPEC predicted global markets surplus inventories will be eliminated late next year after boosting forecasts for supplies from other rivals including the US, according to its monthly report on Wednesday.

Overall, total US crude oil imports from Saudi Arabia fell to the lowest level in 30 years, with some of that decline made up by increased imports from Iraq, EIA reported.

- OPEC crude supply fell in November for the fourth consecutive month to 32.36 mb/d, down 1.3 mb/d on a year ago.

That 2017 consumption projection in the December STEO report was up from the EIA's 73.06-bcfd forecast for the year in its November report. They are now 111 mb above the five-year average.

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Overnight, oil prices settled lower on as traders appeared to take profits on Monday's rally amid reports offering clarity on the duration of the Forties pipeline shutdown.

The EIA forecast both production and consumption would jump to record highs in 2018 with output hitting 81.34 bcfd and usage reaching 76.85 bcfd.

The American Petroleum Institute (API) reported a large draw of 7.382 million barrels of United States crude oil inventories for the week ending December 8. Visit MarketWatch.com for more information on this news. Even so, when our USA outlook is added to expectations for the other producers, output from non-OPEC countries could rise by 1.6 mb/d in 2018, an increase of 0.2 mb/d to our forecast in last month's Report.

"On our current outlook, 2018 may not necessarily be a happy New Year for those who would like to see a tighter market", the Paris-based IEA, which advises most major economies on energy policy, said in the report.

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