Global benchmark were at $74.63 per barrel at 0422 GMT, down 18 cents, or 0.2 percent, from their last close. According to a new study by the IEA, petrochemicals are set to account for more than a third of the growth in world oil demand to 2030, and almost half the growth to 2050. Canada's main benchmark crude index, Western Canada Select (WCS) is now trading at $26.2 per barrel, which is nearly $55 barrel per barrel discount to Brent and $45 per barrel discount to WTI. The IEA sees production from outside the Organization of Petroleum Exporting Countries rising another 1.7 million barrels a day next year.
Oil prices are hovering near multi-year highs, and even with supplies increasing there will be a strain on the markets that will result in higher prices, potentially a bad sign for the global economy.
Members of the Organization of the Petroleum Exporting Countries (OPEC) and other oil-producing allies such as Russian Federation agreed in June to raise oil output. Data released by the U.S. Energy Information Administration on Thursday showed crude supplies in U.S.to have climbed by 6 million barrels in the week ended October 5.
2.8 percent benefit increase announced
The upcoming 2019 increase, which will cover 67 million Americans, is the largest since a 3.6% hike in 2012. A bill has been introduced in the House to make that change, and hasn't moved further.
Oil prices have been creeping upwards for more than a year, quietly gaining ground as emerging-market investors fretted about trade and the end of cheap money. Both global demand and supply are close to hitting 100 million barrels a day for the first time.
The IEA report is the latest official forecaster to predict weaker demand ahead and conclude that supply is adequate.
Although reports of Hurricane Michael causing a 40% drop in the oil output of the Gulf of Mexico helped crude oil prices erase a small part of this week's losses, refineries are expected to return to full capacity soon.
Gasoline stockpiles were up by 1 million barrels last week, while distillate stockpiles declined by 2.7 million barrels, the EIA report revealed. Producers in the so-called OPEC+ coalition, which also includes Russian Federation, have added 1.6 million barrels a day since May, the report showed.