World Oil Market: Approaching Surplus Amid Uncertainty

The International Energy Agency predicts a significant surplus in the global oil market next year, despite rising tensions involving Iran. The agency reassures markets of its preparedness to act against supply disruptions and notes China's weakened demand impacting global oil consumption growth.

The International Energy Agency (IEA) has projected a significant surplus in the global oil market for the coming year, offering reassurance amidst concerns of potential supply disruptions caused by geopolitical tensions with Iran.

Despite investor worries over Israel's possible retaliation against Iranian oil facilities, the IEA highlighted the strength of public stocks, which exceed 1.2 billion barrels, and the substantial spare capacity within the OPEC+ alliance.

Compounding these dynamics is a softened demand forecast, influenced primarily by China's slower economic growth and increased adoption of electric vehicles, which has shifted expectations in the world's second-largest economy.

(With inputs from agencies.)