The world can cope for now with the loss of about one million barrels per day (bpd) of oil from Alaska and Nigeria, but the pressure is on exporter group Opec to fill the gap, the International Energy Agency said yesterday.
It bumped up the estimate of demand for oil from the Organisation of the Petroleum Exporting Countries by 600,000 bpd in the third quarter and 200,000 bpd in the fourth in its monthly Oil Market Report.
But Opec, which pumps a third of the world's oil, is already meeting the extra requirement, the Paris-based agency said. It pegged July Opec output at 29.8 million bpd, well above the revised third quarter call of 29.1 million.
"In the overall balance, there has been no deterioration in oil market fundamentals," said Lawrence Eagles, head of the oil industry and markets division at the IEA. "There's quite a lot of crude around, so there's not much of a worry."
Oil prices hit record highs above $78 (€60.73) this week after BP said it was shutting down production at its 400,000 bpd Prudhoe Bay oilfield in Alaska because of pipeline corrosion.
The prospect of losing up to 8 per cent of US output came on top of supply disruptions in Nigeria, Iraq and worries over the reliability of Iran's exports. The IEA, energy adviser to 26 industrialised nations, pegged Nigerian outages at 750,000 bpd.
Any further supply increase from Opec would squeeze its spare production capacity, which the IEA reckons is around two million bpd. "While Prudhoe Bay represents a significant outage, there are potential offsets, from Saudi Arabia, the US Strategic Petroleum Reserve and above trend refiner stocks," said the IEA. Oil prices rebounded yesterday after shedding more than 3 per cent on news of the bomb plot on flights from UK airports.
US light, sweet crude oil climbed 45 cents at $74.45 a barrel, rebounding slightly from the $2.35 slump on Thursday. London Brent crude rose 47 cents to $75.75.
