Investing.com- Global oil supply demand was revised down due to rising prices, the International Energy Agency said in its latest forecast on Wednesday.
The agency revised its global outlook for 2018 down from 1.5 million barrels per day (bpd) to 1.4 million pbd. Non-OPEC supply was revised up to 1.87 million bpd.
While strong growth continued in the first quarter, the agency expects a slowdown in the second half of the year due to a rise in prices. Looming sanctions against OPEC-member Iran by the U.S. has contributed to rising oil prices and the market is expected to tighten for the rest of the year, the agency said.
The agency also increased its expectation for US oil production growth this year by 120,000 bpd.
"In today's uncertain geopolitical climate, higher production from the US will be an important contribution to compensating for lower volumes from elsewhere," IEA reported.
The price of oil has been caught between a supply agreement by OPEC and the rise in U.S. crude. OPEC agreed in December to cut oil output by 1.8 million bpd until the end of 2018. The agreement was due to end in March 2018, having already been extended once.
Meanwhile, OECD stockpiles have fallen to its lowest level since March 2015 in March, IEA reported.
After the report, U.S. West Texas Intermediate (WTI) crude futures were trading at $71.05 a barrel as of 4:25 AM ET (8:25 GMT).
Brent crude futures, the benchmark for oil prices outside the U.S., was at $77.85 a barrel, not far from a four-year high of $79.15.