International energy market faces new reality of risk – IEA

22 October 2012 04:22  [Source: ICIS news]

SINGAPORE (ICIS)--The global economic downturn and geopolitical uncertainties have created a "new reality of risk" for the international energy market, a senior official from the International Energy Agency (IEA) said on Monday.

"The good news [now] is that OPEC spare capacity is rebuilding to more comfortable [level]," said Maria van der Hoeven, executive director of the IEA.

She was speaking at the Singapore International Energy Week conference, which is held on 22-25 October.

Expectations of oil demand growth has been reduced amid the global economic uncertainty, while on the supply side there are expectations of more oil coming from North America, van der Hoeven said.

Supply concerns have also eased somewhat, with Iraq touching new production highs, she added.

However, the ongoing political unrest in the Middle East and sanctions on Iran, which will remove about 1m bbl/day of oil supply from the international market, will continue to weigh on sentiment, according to van der Hoeven.

By: Nurluqman Suratman

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