Expect Storms Ahead; International Energy Agency Predicts Low Oil Demand For Q4

Due to the recent Hurricane Sandy in the United States, slow economic growth in China and European economic headwinds, the International Energy Agency has cut its global oil production demand forecast. OPEC and the United States Energy Information Administration have already cut down the future oil demand forecast due to the prediction of slow economic growth going forward. In our opinion, the gloomy macroeconomic environment, structural transformation towards natural gas and the emerging alternative renewable forms of energy are going to be the key factors responsible for the decline in oil demand.

The impact of this cut in forecast has been seen in the decreasing Brent crude oil prices. After this news, Brent crude oil price fell  to $107.81 from Tuesday's price of $108.14. We believe that if European economic problems sustain going forward, prices will show a further decline. Read full story