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OIL AND GAS
Economic rebound should cause oil demand to rise, IEA says
by Daniel J. Graeber
Paris (UPI) Aug 12, 2014


AAA says gas prices shrug off overseas turmoil
Washington (UPI) Aug 12, 2013 - The U.S. national average retail price for a gallon of regular unleaded continues to fall despite overseas turmoil, motor club AAA said.

AAA reports a national average price Tuesday of $3.47 for a gallon of regular unleaded, down 2 cents from this time last week and 15 cents from one month ago. The national average price for this date last year was $3.52 per gallon.

AAA says drivers in most states saw prices at the pump decline, though some markets posted incremental increases last week because of refinery issues in the Midwest and Central states.

In an asessment on price trends, published Monday, AAA said crude oil prices have traded near multi-month lows despite U.S. airstrikes on Sunni insurgents in Iraq, simmering internal conflicts in Libya and ongoing tensions between Russia and Ukraine.

"None of these occurrences have resulted in a disruption to supply," AAA said.

The U.S. Energy Department says 67 percent of the price at the pump is tied to crude oil prices, with the bulk of the rest associated with refinery costs and taxes. The department says it expects gasoline prices to average $3.54 for the full year and fall to $3.45 in 2015.

Global demand for oil should accelerate by 1.3 million barrels per day in 2015, a 30 percent increase, because of economic recovery, the IEA said from Paris.

The International Energy Agency said Tuesday it lowered its growth forecast for global oil demand to 1 million barrels per day in part due to weaker economic outlook from the International Monetary Fund.

For the United States, one of the world's leading economies, the IMF said in a July report parts of the economy were still struggling to gain traction, though overall growth for 2015 should "accelerate to the fastest annual pace since 2005" barring any unforeseen shocks.

Globally, IEA said in its oil market report for August that "as the economy improves in 2015, [oil] demand is set to accelerate by 1.3 million bpd."

In July, the Paris-based group said oil supplies increased by 840,000 bpd on the back of a 1.2 million bpd increase from producers outside the Organization of Petroleum Exporting Countries. That helped offset declines among most OPEC members, though IEA said it was an increase to 10 million bpd from Saudi Arabia and a "tentative recovery" from Libya.

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