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First Look - IEA sees oil supply growth outpacing demand in 2025

Oil is trading higher, extending gains from yesterday
- Prompt spreads have improved lately, potentially signaling a stronger near-term market
- The API forecasts a drop in US crude inventories of 800 MBbls ahead of the official data release later today
IEA sees supply glut in 2025 (BBG)
- Oil supply is expected to exceed demand by 1 MMBbl/d in 2025, as Chinese demand continues to falter
- China’s oil demand is expected to grow by 140 MBbl/d, a much smaller number than in 2024
- Non-OPEC capacity is anticipated to grow, led by Brazil, Guyana, and Norway
- Earlier this week, OPEC also cut its global oil demand forecast

Natural gas prices were down by 2.7c to $2.956 (8:08) in Thursday morning trading
- The December contract rallied to touch $3.02/MMBtu yesterday before settling at $2.983
- The Henry Hub cash market also rallied on Wednesday, climbing to $1.935 from weekend gas that was in the low $1’s
- Analysts expect another bearish storage print this morning from the EIA as the average survey calls for a 39 Bcf build vs a 29 Bcf five-year average
Waha cash prices have been hovering near -$2 as maintenance pressures the basin (as of Nov 12 – ICE)
- Work on the Permian Highway Pipeline (PHP) system has reduced flows on the pipe by about 1.2 Bcf/d
- Even with the new Matterhorn Pipeline online, the Permian has had to contend with a string of maintenance. One wonders what prices would have been without Matterhorn coming online…
- AEGIS notes that the full potential of the Permian gas supply will have to wait until outages conclude