Global Oil Market Faces Surplus Amidst Geopolitical Tensions

The International Energy Agency (IEA) reports a potential oil surplus in the coming year, despite recent price hikes due to geopolitical tensions between Iran and Israel. The IEA emphasizes readiness to counter supply disruptions, while highlighting slowing Chinese demand impacting global growth forecasts.

The International Energy Agency (IEA) has indicated that the global oil market is on course for a significant surplus in the new year. This statement comes amidst rising oil prices fueled by investor fears of potential conflict between Israel and Iran, a key oil exporter and OPEC member.

The IEA, responsible for managing emergency oil stocks for industrialized countries, notes that public oil stocks exceed 1.2 billion barrels, and OPEC+ spare capacity remains at historic highs. Despite these pressures, the IEA assured it could intervene to mitigate any major supply disruptions.

Furthermore, the agency revised down its global oil demand growth forecast, citing underwhelming performance from China as a key factor. This shift in expectations is attributed to slowing economic growth and Chinese consumers' transition to electric vehicles.

(With inputs from agencies.)