The oil market is re-balancing but output from non-OPEC producers will continue to expand over the coming years, the latest report from the International Energy Agency said Friday.
The IEA said that oil stocks are continuing to fall, but from a great height, and more time is needed before the effects of production cuts are felt.
On Thursday, OPEC announced a continued rise in its collective output, undermining its efforts to reduce production and boost prices.
OPEC output jumped by 173,000 barrels a day in July to almost 32.9 million barrels, its highest level since the production agreement came into force in January.
The increase marks the fourth consecutive month of output expansion as growing production from Libya and Nigeria, which are both exempt from the deal, and U.S. drillers continue to frustrate efforts.
– CNBC’s Tom DiChristopher contributed to this report.