Analysis of the crude market seems to have fallen into a specific groove of late, with the experts praising the Organization of the Petroleum Exporting Countries (OPEC) for achieving high compliance with its cutback deal and noting a rising demand for oil - but falling well short of stating decisively that the market will therefore rebalance in 2018.
This was the position paid out by Fatih Birol, executive director of International Energy Agency (IEA),who on Tuesday told Bloomberg television that 2017 saw "very strong demand growth of 1.6 million barrels per day, and also next year we'll see 1.4 million.
"In terms of supply, we expect the United States, Canada, Brazil, to bring a decent amount of oil to the markets, and it will depend on what [OPEC] decides this November.....if they continue with their policies, we may see a rebalancing of the markets" - but he added that geopolitical events may affect this outcome.
Fatih Birol, executive director, International Energy Agency
Rebalancing may be underway, but this way may be longer than we think.
Birol also hedged his bets by saying, "we still have a substantial amount of stocks in the market ... and we have to continue to see demand continue to increase and supply not as strong as we've been experiencing ... and according to our numbers, even the first quarter of this year may be too optimistic to see a rebalancing."
He concluded that rebalancing "may be underway, but this way may be longer than we think."
In a similarly cautious and non-commital vein, Victor Shum, vice president for energy at IHS Markit, told Bloomberg television that global stocks have reduced and compliance among members of OPEC "is very good," leaving geopolitics to occupy the minds of analysts.
Accordingly, he says tensions between Iraq and Kurdistan "will continue to support prices" and that rising tension between the U.S. and Iran bears monitoring because these factors combined could boost prices and then encourage increased production from the U.S., Canada, and other non-OPEC countries: "So if we look into 2018, we anticipate a global oil surplus to re-emerge and prices will be lower than in 2017."
When asked to comment on the Iraq/Kurd conflict and U.S. president Donald Trump's decision to decertify its nuclear deal with Iran, IEA's Birol replied, "It is too early to say how these geopolitical developments will continue and how much they will have an impact on oil prices.
"These issues remind us oil and geopolitics are very much interlinked and it will remain so... oil security remains a critical issue for all the countries."
Reporters did not ask Birol about the seeming discrepancy between his current, cautious outlook and a report issued by his agency last week that stated the global glut will be cleared next year, and whether the report's findings were taken out of context or if the agency has had a sudden change of heart.