The International Energy Agency warned Wednesday a potential supply shortfall from Iran and Venezuela could present a "major challenge" for oil producers if they are to fend off sharp price rises and fill the gap, and reiterated its readiness to act if necessary to ensure a well-supplied market.
The IEA also said OECD oil stocks had fallen below the five-year average level for the first time in March, by 1 million barrels, representing a benchmark for the success of OPEC/non-OPEC production cuts.
In its monthly oil market report the IEA lowered its estimate for growth in world oil demand this year to 1.4 million b/d, from 1.5 million b/d due to higher oil prices.
And it estimated the 'call' for OPEC crude would be 580,000 b/d above the cartel's actual output in April for the rest of this year.
With Iran facing export barriers following the US decision to pull out of a sanctions waiver, and Venezuela's output potentially falling by several hundred thousand barrels a day more this year, "the potential double supply shortfall represented by Iran and Venezuela could present a major challenge for producers to fend off sharp price rises and fill the gap, not just in terms of the number of barrels but also in terms of oil quality," the report said. - Platts -