THE UK’S demand for oil rose to a near two-year high earlier this year, while UK North Sea production continues to fall, according to the IEA’s monthly oil report published yesterday.
The surge in UK oil demand, which rose to a high of around 1.6m barrels per day in February, helped lift the estimate of global demand for the first quarter, the report said.
But production from the North Sea is expected to fall by around 30,000 barrels per day this quarter to 770,000 barrels per day, declining from an average of 850,000 barrels per day in January.
The UK’s largest oil field, the Buzzard field, was shut down for maintenance unexpectedly last month, which took its toll on production, the IEA said.
The IEA has raised its forecast for global demand growth for 2014 to 1.32m barrels per day and warned that there may be a supply shortage from the Organisation of the Petroleum Exporting Countries (Opec) later this year. “While Opec production gains of around 400,000 barrels of oil per day went some ways towards easing markets last month, that gain will be insufficient to meet market needs in the second half of the year, when consumption bounces back seasonally,” the report said.
The IEA predicts that Opec countries would need to raise third-quarter production by another 900,000 barrels of oil per day from April levels, with possible threats to supply coming from Libya and Iraq. Outside of Opec, politically-driven disruptions have intensified in Colombia and South Sudan.