The report serves as a stark warning to the world’s largest oil exporters, who meet next week in Vienna to discuss supply policy, Reuters reported.
The IEA said it expects global oil demand to grow by 1.4 million barrels per day in 2019, to top 100 million bpd by the second quarter of the year. The agency expects demand to grow at the same rate this year, unchanged from its last report in May.
The oil price has risen by a third to around $76 a barrel, close to its highest since late 2014, since OPEC and other producers including Russia began cutting production in January 2017 by 1.8 million bpd.
Canada and the European Union have announced plans to increase tariffs on selected U.S. goods in response to U.S. duties on steel and aluminum imports.
The Organization of the Petroleum Exporting Countries meets on June 22/23 to discuss its supply policy, particularly in light of protracted declines in Venezuela and the prospect of new U.S. sanctions on Iran later this year.
The group, together with its partners, may consider raising output to compensate for any supply shortfalls.
The agency said it had looked at a scenario in which by the end of next year output from Iran and Venezuela could be 1.5 million bpd lower than it is today.
The IEA estimated that Iranian exports would drop by the same amount as they did during the last round of sanctions.
For Venezuela, the agency said it saw no respite in the collapse in production from economic crisis that has taken 1 million bpd off the market in the past two years.
OPEC’s efforts in restraining output led to commercial oil stocks across the world’s richest nations falling by 3.1 million barrels in April to a new three-year low of 2.809 billion barrels, the agency said.
Supply from outside OPEC is expected to grow by 2 million bpd this year, led predominantly by the United States, before easing to around 1.7 million bpd next year, the IEA said.
The IEA estimated demand for OPEC’s crude would ease in 2019 to 31.6 million bpd from a forecast 31.9 million bpd this year.