Then you had Old Ben Bernanke. It seems the market likes what he said and is convinced that this taper talk is on the back burner. Not only is it on the back burner, but it's been said that accommodative monetary policy is needed for the foreseeable future even after the unemployment rate falls to 6.5%.
Bloomberg News is reporting that The International Energy Agency sees a 20-year supply peak outpacing demand. Oil supply will outstrip an acceleration in demand growth next year as production outside of OPEC expands at the fastest pace in 20 years, the International Energy Agency predicted. World oil consumption will climb by 1.2 million barrels a day next year, up from 930,000 a day in 2013, the IEA said in its first monthly report with forecasts for 2014. Supplies from outside the Organization of Petroleum Exporting Countries will jump by 1.3 million barrels a day amid booming output in North America, shrinking the need for crude from the 12-member producer group, according to the report. The assessment should "give bulls some cause for alarm," the Paris-based adviser to oil-consuming nations said. "While demand growth is also forecast to pick up momentum," this "will still fall short of forecast non-OPEC supply growth."
Brent crude has lost about 2% this year, trading today near $109 a barrel on the London-based ICE Futures Europe exchange, as economic stagnation in Europe, slowing expansion in China and threats to recovery in the U.S. constrain fuel consumption. Dependence on OPEC is dwindling as new drilling techniques enable the U.S. and Canada to unlock reserves from rock formations deep underground. Global demand will average 92 million barrels a day in 2014, advancing by 1.2 million barrels a day, or 1.3 percent from this year, according to the IEA report. The agency said that today's forecast hasn't yet incorporated a reduction to 2013 economic growth estimates made by the International Monetary Fund on July 9. The Washington-based IMF trimmed its projection for global growth this year to3.1 percent, from 3.3 percent. The agency boosted its estimate for demand in 2013 by 220,000 barrels a day from last month's report, estimating that oil use will expand by 930,000 barrels a day, or 1 percent, to 90.77 million a day this year. The revision, the third increase to the 2013 outlook to be made this year, was driven by unusually cold weather in the second quarter.
Nat Gas Report Today! Short term - Cool Temperatures have been weighing on the market. Long Term - The story is getting more intriguing. Reuters reports "A bipartisan group of U.S. senators on Wednesday called on the Energy Department to speed up its planned review process for proposals to ship U.S. liquefied natural gas (LNG) abroad. ‘We are concerned that the timeline for considering these applications may jeopardize our ability to retain a competitive position against other natural gas exporting nations,’ more than two dozen lawmakers, including top Senate Republican Mitch McConnell, said in a letter to Energy Secretary Ernest Moniz.”