For Nigeria lower budget deficit as oil touches $80 a barrel

Oil hits high

Oil hits high

"Solid oil demand, reduced OPEC output and geopolitical developments continue to underpin price gains", said the IEA.

The IEA said global oil demand would average 99.2 million bpd in 2018, although USA bank Goldman Sachs said consumption would cross 100 million bpd "this summer". "We are in a world where geopolitics are dominating the market again", Patrick Pouyanne said at an event held by a Washington think tank.

The current rise of oil production is fueled by natural gas condensates and liquids, neither of which is used for producing the needed diesel.

"The catalyst for the latest move appears to be more concerns about the state of the supply and demand balance and OPEC's apparent unwillingness to do anything about it, even as Iran faces fresh sanctions and Venezuelan production is pressured", said Greg McKenna, an analyst at AxiTrader.

Much of the Iran's oil exports head to Asia now, with over than 1.5 million barrels per day sent to the likes of China, Japan, South Korea, and India.

"While global inventories are approaching long-run averages, there is a building concern over demand growth, partially on account of higher prices".

OIL STOCKS: Across Europe, oil companies were in demand amid higher oil prices.

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Opec crude production eased in April to almost 31.7m b/d, even as demand for the cartel's crude is expected at a greater level of 32.2m b/d this year. "As ever, the IEA stands ready to act if necessary to ensure markets remain well supplied".

Along with the rise in non-OPEC production, the agency sees demand growth of 1.4 million barrels a day, down by 100,000 barrels from last month's report.

"Aggregate production - both actual and projected - is growing for the majors", S&P Global Ratings said in a report published on Tuesday.

A day earlier, Total said it wouldn't commit any more funds to Iran's South Pars 11 natural gas project, in which it took a controlling stake a year ago.

The nationwide inventory estimate contrasts with forecasts in a Bloomberg survey that show stockpiles declined by 2 million barrels.

Benchmark oil contract Brent North Sea surged above $80 a barrel Thursday, hitting the highest level since November 2014 on concerns that Iranian exports could fall due to renewed U.S. sanctions and reduce supply in an already tightening market.

TOTAL: French oil and gas producer Total said it would not be able to continue a multi-billion dollar project in Iran unless it is granted a waiver by USA authorities. The IEA acknowledged attention of market participants has shifted away from inventories to price volatility.

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