Bloomberg reports that "global oil markets will remain oversupplied next year as demand growth slows and Iranian exports are poised to recover with the lifting of sanctions, the International Energy Agency said."
"While supplies outside OPEC will decline in 2016 in response to lower prices, demand growth will ease from this year’s five-year high amid a weaker outlook for the world economy, allowing the crude surplus to endure, the IEA predicted. Iran could swell the glut if restrictions on its sales are removed with the completion of a nuclear accord, while Iraq has replaced the U.S. as the biggest source of new supplies as its output reaches record levels."
“'The market may be off balance for a while longer,' the Paris-based adviser to 29 nations said in its monthly report. 'A projected marked slowdown in demand growth next year and the anticipated arrival of additional Iranian barrels — should international sanctions be eased — are likely to keep the market oversupplied through 2016.'”
The Financial Times reports that "weaker economic growth in oil-dependent economies such as Canada, Brazil, Venezuela, Russia and Saudi Arabia will also have an impact on demand growth."
“'Lower commodity prices, with all else held equal, eventually equate to lower public spending and a potential dampening in consumer expenditure in many of these countries,' the IEA said."