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Doubts raised over impact of oil summit

BBC News BBC News 14/04/2016
Offshore oil platform rigs in Port Fourchon, Louisiana © Getty Images Offshore oil platform rigs in Port Fourchon, Louisiana

A deal to limit oil output, to be discussed in Doha this weekend, would have a limited impact, says the International Energy Agency (IEA).

Opec and non-Opec oil producers are due to discuss a deal that would freeze oil production at current levels.

If they agree on that freeze, rather than a cut in output, the impact on oil supplies "will be limited", the IEA said in its monthly report.

Oil prices have plunged since mid-2014, as supply has run ahead of demand.

The IEA points out that Saudi Arabia and Russia are "already producing at near record rates" and that Iran has plans to raise production back to the levels seen before it was hit with sanctions.

Global stocks of oil have hit a record three billion barrels this year.

US slowdown

However, the agency says that there is mounting evidence that US production is being hit by spending cuts.

It also said that Iran's return to the market had been "more measured that expected".

As a result, "the oil market looks set to move close to balance in the second half of this year," the agency said in its report.

As for oil demand, the IEA trimmed its estimate for global demand growth for 2016 to 1.16 million barrels per day.

North Sea Brent crude was down 12 cents at $44.06 a barrel.

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