The International Energy Agency cited falling OPEC and U.S. production among the factors in forecasting that crude prices may have hit a floor. Fred Katayama reports.
The massive slide in crude oil prices may have finally hit a bottom. That's what the International Energy Agency said Friday in its monthly report. The agency coordinates energy policies of major countries. It attributed its outlook to falling oil production in several OPEC countries, declining output forecast for the United States ... and growth in Iranian production that is less than Tehran had promised. U.S. crude prices, which are down from its $107 a barrel peak in 2014 to the mid-$30 level, shot higher after the report came out. First Standard Financial chief market economist Peter Cardillo said, "There's a lot less production. Rig counts are at very low levels. I think the price range stays between $35-42 in the next quarter. That should be helpful for stocks." The IEA did not change its outlook for growth in global oil demand this year. And it forecast flat demand by the world's biggest consumer, the United States. What's more, it said demand could weaken if oil prices kept their upward momentum. And it said demand by China, the second largest consumer, will be far below its 10 year average.