The recovery of oil prices is built on shaky foundations. That’s the view of the International Energy Agency which warns, in its monthly oil market report that another sharp fall is possible.
It added that global oil glut was building and US oil production showed no signs of slowing. Brent crude fell below 57 dollars a barrel on Friday following publication of the report.
Having bottomed in the second quarter of 2014, global oil demand growth has since risen steadily. “Tentative signs of a demand recovery have emerged with the turn of the year, with heavy emphasis reserved for the word, ‘tentative’,” the Paris based agency said.