Oil prices slip as International Energy Agency cuts demand growth forecast

Environment

Aerial top view of a ship at sea.
Suriyapong Thongsawang | Moment | Getty Images

Crude oil futures edged lower Wednesday as the International Energy sees global demand growing less than originally forecast this year.

World oil demand is forecast to grow by 1.1 million barrels per day this year, down 140,000 bpd from last month’s projection as demand in developed economies softened in the first quarter, according to an IEA report.

U.S. oil and Brent are down 5.4% and 6.86%, respectively, for the month.

Here are today’s energy prices:

  • West Texas Intermediate June contract: $77.66 a barrel, down 36 cents, or 0.46%. Year to date, U.S. crude oil has gained 8%.
  • Brent July contract: $81.96 a barrel, down 43 cents, or 0.52%. Year to date, the global benchmark has gained 6%.
  • RBOB Gasoline June contract: $2.47 a gallon, up 0.31%. Year to date, gasoline futures have gained 17%
  • Natural Gas June contract: $2.36 per thousand cubic feet, up 0.47%. Year to date, gas has gained 6%.

Global crude inventories surged in March by 34.6 million barrels as trade disruptions pushed oil on water to a post pandemic high, according to the IEA. Oil deliveries have been rerouted this year due to attacks by Yemen-based Houthi militants on shipping through the Red Sea.

Inventories continued to build in April as oil on water was discharged to land, leading to an increase in onshore stockpiles, according to the IEA.

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WTI v. Brent

OPEC+ will likely take a close look at global inventories to gauge the balance between supply and demand at its June meeting, according to the IEA. Some OPEC+ members have implemented voluntary production cuts of 2.2 million bpd to support crude prices.

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