The International Energy Agency, IEA, has been cutting its oil demand forecasts, albeit only slightly. I suspect that they are lagging in this regard. See here for a recent update.
Also surprising that they are cutting their forecast of non-OPEC supply. At $130 per barrel, I don't understand why we are not seeing a significant increase in quantity supplied.
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I’ve been wondering why we haven’t seen increased production too. The common excuse is that it “takes time to build capacity”, but come on. Is every oil source in the world working 3 shifts at max capacity? There's no opportunity at all for short term investment to increase production? I find that hard to believe.
Equally surprising is that OPEC countries seem to be able to resist the temptation to cheat at their quotas.
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