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Oil markets gain following latest IEA report

An uplift in oil values has been seen today. 


Oil markets have responded favourably to the latest report of the International Energy Agency (IEA), which revealed unprecedented declines in the investment outlook for this precious commodity in the years ahead.


The body forecast that average values for both Brent and US light crude oil will reach $80 per barrel by the end of the decade, but this will come at the cost of lower levels of investment in the sector and a lasting position of oversupply.


Annual demand growth is currently struggling to meet increasing volumes of new supply that are being brought online - most notably by the Organization of the Petroleum Exporting Countries (OPEC), but also as a result of an end to trade sanctions against Iran.


However, the growth in stockpiles being witnessed in the US in particular has been one of the strongest factors to have pushed down prices in recent weeks.


Senior oil analyst and market expert Ole Hansen told Reuters: "It has been the weekly [US] inventory report that has been driving the market for the past three weeks.


"It also highlights the focus that the world market has on the US at the moment because that's really where the market is looking for the rebalancing to come from, so as long as that doesn't get provided then the market will continue to find itself under some selling pressure."


As of 3.58 pm GMT, major oil markets had seen a significant boost in values from the start of trading today (10 November 2015). Prices for US light crude oil had risen by $0.45 to $44.32 per barrel by the mid-afternoon, while Brent crude values were also up by $0.19 per barrel to $47.38.

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