CALGARY — The latest outlook from the International Energy Agency shows little sign that the oil supply glut hitting prices and Canada's oil producers will let up soon.
The November report says global demand for oil is forecast to increase by 1.2 million barrels a day next year, down from an increase of 1.8 million barrels a day this year, as the short-term boost from low oil prices fades and "problematic" economic conditions in countries like China persist.
Meanwhile stockpiles of oil in OECD countries were at a record high of nearly three billion barrels at the end of September despite the low prices, giving an "unprecedented buffer" against geopolitical shocks or unexpected supply disruptions, the IEA says.
Canada's petroleum producers have been writing down assets by the billions in recent quarters as they adjust to oil prices below US$50 a barrel compared with more than double that last year.
The low oil prices have had little effect on short-term production growth in Canada's oilsands, but the IEA forecasts non-OPEC production to drop by 600,000 barrels a day thanks largely to the drop in production from shale oil in the United States.
The North American benchmark oil price was trading slightly above US$40 a barrel Friday for its lowest price since August.