IEA sees risk of decline in oil demand if Brent price exceeds $70 per barrel

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MOSCOW, April 11. /TASS/. The rise of oil prices to $70 per barrel and higher increases the risk of a slowdown in demand amid uncertainties in the global economy, according to an April report from the International Energy Agency (IEA).

“Clearly, oil prices at $70/bbl for Brent, are less comfortable for consumers than they were at the start of the year and the IEA has regularly warned of the dangers of prices rising even higher. Only time will tell if our current demand forecast proves accurate, but the risks are currently to the downside,” according to the report.

IEA analysts stress that the demand for oil in the OECD countries in the fourth quarter of 2018 fell by 0.3 mln barrels per day on an annualized basis, which was the strongest fall in the developed countries since 2014. According to the results of the first quarter of 2019, the decline may continue amid economic slowdown in a number of European countries, the analysts say. They add that Brexit also contributes to the decline in demand.

“The oil market shows signs of tightening, but there are  mixed signals in terms of the outlook for demand and whether stock levels are yet “normal,” the document reads.

In its April report the IEA maintained its forecast for oil demand growth in 2019 at 1.4 million barrels per day.

In February, the oil reserves of the OECD countries remained at 16 million barrels above the five-year average.

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