* Sees global oil markets well supplied now
* Prices could rise on seasonal demand
* Oil outages in Libya and Iraq also a worry
(Adds detail throughout)
By Christopher Johnson
LONDON, Nov 14 Oil markets look well supplied in
the short term but prices could rise in the next few months due
to a seasonal increase in demand and production problems in some
OPEC producers, the West's energy watchdog said on Thursday.
The International Energy Agency (IEA) said in its monthly
report oil was likely to stay volatile with prices responding to
political turmoil in Libya, security problems in Iraq and
stronger northern hemisphere winter consumption.
"The recent easing of prices may be relatively short-lived,"
the IEA said. "End-user demand is on the verge of a seasonal
ramp-up while refinery throughputs look set for a steep rebound
in November and December."
"Although the medium-term outlook seems to be one of easing
fundamentals and first-quarter balances look comfortable on
paper, the same short-term cycles that have recently undermined
prices may soon cause them to come under renewed upside
pressure," the agency added.
"Production problems in Libya and Iraq, among others,
continue to relentlessly fester, and may prove more
market-supportive," it said. "The market might not be at the end
of its roller coaster ride."
The IEA, which advises large consuming countries on energy
policy, said OPEC oil production fell for a third month in a row
in October, dropping 105,000 barrels per day (bpd) to 29.89
million bpd, just below its estimate of demand for OPEC oil this
year of around 30 million bpd.
Oil ministers from the Organization of the Petroleum
Exporting Countries are due to meet in Vienna on Dec. 4 to
discuss the market outlook for 2014 but several ministers have
said they expect the cartel's output target to remain unchanged.
OPEC's problem is that demand for its oil is falling
gradually as producers outside the group, such as the United
States, pump more and more each year.
The IEA expects demand for OPEC oil to fall next year to
29.1 million bpd and says supply from non-OPEC countries is
rising rapidly, led by North American tight oil from shale
formations in Texas, North Dakota and other states.
Big increases in North America, the North Sea, Russia, and
Ghana pushed non-OPEC oil output higher last month and the IEA
sees total non-OPEC production growth at 1.3 million bpd this
year and at 1.8 million bpd in 2014.
Global demand, meanwhile, is rising less quickly.
Overall oil consumption is forecast to grow by around 1
million bpd this year due to reduced expectations of economic
growth. An increase of close to 1.1 million bpd is forecast for
This has kept global oil inventory levels comfortable.
The IEA said total commercial oil inventories in the
developed economies of the OECD built counter-seasonally in
September as crude stocks swung to a surplus over average
"Liquid supply has remained robust, as surging North
American production has so far more than offset disruptions
elsewhere," the IEA said. "Despite continued OPEC production
problems, for now global oil markets seem well supplied."
(Editing by William Hardy)