Brent crude oil steadied near $50 a barrel on Tuesday after the west’s energy watchdog forecast a global supply glut would last through 2016 thanks to slowing demand growth.
The International Energy Agency (IEA) said the world oil market would remain oversupplied for at least another year despite falls in output from non-OPEC producers.
North Sea Brent crude was up 14 cents a barrel at $50.00 by 1230 GMT. U.S. light crude was up 22 cents at $47.32.
Both benchmarks have been volatile over the last year.
Brent slumped to a low of almost $42 a barrel in August, from above $115 in June 2014. It rallied to above $54 at the end of last week on signs of falling production in the United States, before easing down again this week.
Analysts say oil prices are struggling to find a range, supported by expectations of lower supply in the future but depressed by a global surplus for some time to come.
“A projected marked slowdown in demand growth next year and the anticipated arrival of additional Iranian barrels – should international sanctions be eased – are likely to keep the market oversupplied through 2016,” the IEA said in its monthly report.
The Paris-based agency said global oil demand would increase by 1.21 million barrels per day (bpd) in 2016, down 150,000 bpd from its forecast last month.
About Alfonso Esparza
Senior Currency Strategist, OANDA, Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, he established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto. Follow on Twitterand on his Google+ profile.