(September 9, 2019) The International Energy Agency (IEA) said today that the United States has briefly dethroned Saudi Arabia as the world’s top exporter, according to a Reuters report.
“With oil prices currently about 20 per cent lower than a year ago, there will be support for consumers… Booming shale production has allowed the US to close in on, and briefly overtake, Saudi Arabia as the world’s top oil exporter, ” the IEA said in its monthly report.
Given no further breakdown in US-China trade talks and citing an easing of tensions around Iran, the Paris-based agency maintained its estimate for growth in global oil demand during 2019 at 1.1 million bpd and 1.3 million bpd for 2020.
A rebound in US production following Hurricane Dorian along with steep output growth from Brazil and the North Sea were set to drive production from outside the Organisation of the Petroleum Exporting Countries (OPEC) up sharply, it added.
Non-Opec production growth is seen rising to 2.3 million bpd in 2020, up 400,000 from this year. Meanwhile, demand for Opec crude is set to reach 28.3 million bpd in the first half of 2020, 1.4 million bpd less than the group produced in August.
The discrepancy may prompt OPEC and its allies including Russia to revisit their production-curbing pact.
“The implied market balance (will be) returning to a significant surplus and placing pressure on prices,” the IEA said. “The challenge of market management remains a daunting one well into 2020.”