IEA lifts oil supply forecasts for 2024 to 1.5 million barrels a day

By Will Horner

The International Energy Agency raised its forecast for global oil supplies next year while moderating its demand expectations, pointing to a more balanced oil market that could cap oil prices.

In its monthly market report, the IEA said it expects oil supplies to rise by 1.5 million barrels a day next year, 300,000 barrels a day more than it was expecting last month.

That is as production increases in the U.S., Brazil and Guyana serve to counter production cuts by Russia and Saudi Arabia, undermining those nation’s efforts to support oil prices and boost their oil revenues.

At the same time, the Paris-based intergovernmental organization said it expects oil demand to rise by 1 million barrels a day next year, roughly half the demand growth seen in 2023 and 100,000 barrels a day less than last month’s forecast.

The changes mean that the IEA expects oil demand to exceed supply by a more modest 200,000 barrels a day next year, compared with a 700,000 barrel-a-day deficit in 2023. That could provide relief for economies still struggling with the lingering effects of inflation and prevent a repeat of the sharply higher oil prices that followed the outbreak of war in Ukraine.

Oil producers not part of OPEC+, the alliance between the Organization of the Petroleum Exporting Countries and a group of Russia-led oil producers, are set to dominate the increase in oil output, challenging the cartel’s control over the oil market and diminishing the ability of major producers such as Saudi Arabia to dictate global oil balances.

“Non-OPEC+ oil supply, now at its highest level ever, nearly matches the OPEC+ alliance barrel-for-barrel and looks set to do so through next year,” the IEA said. “That’s a dramatic change from 2017, when OPEC+ was first established.”

Non-OPEC+ oil producers will pump just under half of all barrels next year, the IEA expects. In 2017, they accounted for just 43% of all oil produced.

The IEA’s forecasts are based on the current agreement of members of the Organization of the Petroleum Exporting Countries and its allies, known collectively as OPEC+, which could easily change in the coming months, the IEA acknowledged.

OPEC+’s largest members and dominant decision makers, Saudi Arabia and Russia, have in recent months sharply slashed their output in an attempt to boost oil prices, cuts which have been periodically extended.

Either nation could at any moment choose to reverse the cuts, though doing so would likely weigh on oil prices and with it their oil income. An oil price war between Moscow and Riyadh in 2020 threatened the end of the OPEC+ alliance and, in an unprecedented event, briefly sent oil prices into negative territory as the two countries raced to increase their output and capture a larger share of the market.

Write to Will Horner at

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