The content has been shared, if you want to share this content with other users click here.
The International Energy Agency (IEA) has revised up its 2018 global oil demand forecast, helping to ease fears of a North American supply glut.
In its latest oil market report published on Tuesday, the Paris-based body predicted demand growth of 1.4Mb/d this year - up 7.7% on its previous projection - following an optimistic GDP forecast from the IMF.
"For 2018, the more positive global economic picture published by the International Monetary Fund is a key factor in raising our growth outlook to 1.4Mb/d," the IEA said.
"It was thought that the significant increase in the dollar price of crude oil since the middle of 2017 would dampen growth, and this might be the case to some extent, but the impact of higher prices has been partly offset in some countries by currency appreciations."
Despite stronger than expected global economic data, the IEA warned that higher output in the US - now the world's second largest producer - would offset demand gains.
"The main message remains unchanged from last month and it is very clear: in 2018, fast rising production in non-OPEC countries, led by the US, is likely to grow by more than demand," the report said.
Brent crude futures (LCOc1) were trading at US$62.57/b late on Tuesday, down two cents from their overnight value.
The oil benchmark fell for six straight sessions last week after breaking through US$70/bl for the first time since December 2014.
"For now, the upward momentum that drove the price of Brent crude oil to $70/b has stalled; partly due to investors taking profits, but also as part of the corrections we have seen recently in many markets," the agency said. "Most importantly, the underlying oil market fundamentals in the early part of 2018 look less supportive for prices."