The International Energy Agency said in its monthly report that global oil production capacity has fallen to 2 percent of global demand, with further declines likely. The smoother may continue for some time and will probably be accompanied by higher prices but will have a potentially negative impact on the global economy, the agency said.
OPEC members, along with other producers such as Russia, agreed last June to increase production as the oil market continues to strengthen. Brent crude rose from about $ 45 a barrel in June 2017 to 4-year highs at $ 85 a barrel.
OPEC, Russia and other U.S. oil companies have increased production sharply since May, leading to a 1.4 million bpd increase in world production, the agency said.
OPEC has generally boosted production by 375,000 bpd since May, as Gulf producers in the Middle East, such as Saudi Arabia and the United Arab Emirates, as output in Venezuela and Iran has been reduced, as Iran faces U.S. sanctions next month.
Also, the International Energy Agency said Iran's oil supplies fell in September to a 2 1/2 year low as customers continued to cut their purchases of Iranian oil as the new sanctions, which begin on November 4, are approaching.
The IEA cut its forecast for world oil demand growth by 0.11 million bpd this year and next year and near 1.28 million bpd in 2018 and 1.36 million bpd in 2019.
