Oil Prices Fall as IEA Forecasts Growing Supply


Oil prices skidded lower Friday on concerns over supply, as the International Energy Agency forecast even higher production in 2014, driven by non-OPEC producers.

In fact, the IEA said in its monthly report the U.S. is on pace to become the world’s largest oil producer next year.

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Domestic shale oil production has already cut into OPEC’s share of the global oil market. The U.S. will continue to compensate for anticipated disruption in OPEC production next year, according to the IEA.

The Paris-based energy organization sees total non-OPEC supply rising by an average of 1.7 million barrels a day to 56.4 million, hiking its prior estimate by 300,000 barrels a day. That would reflect the highest annual growth for non-OPEC countries like the U.S. and Canada since the 1970s.

The IEA also cut its forecast for global oil demand growth by 100,000 barrels a day. Worldwide consumption next year is expected to rise by 1.1 million barrels, a 1.2% increase, to 92 million barrels a day.

U.S. crude oil futures were down 1.8% at $101.15 a barrel on Friday morning, moving toward its fourth weekly decline in five weeks. Brent crude ticked less than 1% lower to $110.94.

At $9.79 a barrel, the spread between U.S. crude and brent -- the benchmark variety generally used in Europe -- is the widest margin since early June.

Friday’s report from the IEA comes amid a scarce amount of data from U.S. government agencies.

The Energy Information Administration, which has remained operational during the partial government shutdown, now says it will furlough employees and suspend the release of its own reports.