Dec. 14 (UPI) -- Flat average economic growth for the world's leading economies and a not-too-rosy outlook for a balanced market next year sent oil prices lower early Thursday.
"On our current outlook, 2018 may not necessarily be a happy New Year for those who would like to see a tighter market," the International Energy Agency said in its monthly market report.
An oversupplied market for crude oil, led by gains from U.S. shale oil and a previous OPEC policy of defending its market share with robust production levels, pushed oil prices below $30 per barrel in early 2016. Seeking to return the market to balance, the Organization of Petroleum Exporting Countries in January started sidelining about 2 percent of global demand for oil. In late November, OPEC, with the help of non-member states like Russia, decided to extend the effort for another year.
The IEA said balance is coming, but it probably won't happen for at least another six months.
"Total supply growth could exceed demand growth," it said. "In the first half [of the year], the surplus could be 200,000 barrels before reverting to a deficit of about 200,000 barrels in the second half, leaving 2018 as a whole showing a closely balanced market."
For the global economy, the Organization of Economic Cooperation and Development reported real gross domestic product for the world's leading 20 economies grew 1 percent in the third quarter, unchanged from the second quarter, but noticeably lopsided.
Among the expanders, South Korea led the pack, jumping 0.6 percent to 1.5 percent in the third quarter. For the United States, the world's leading economy, the OECD report said growth was stable. China, the No. 2 behind the United States, declined from 1.8 percent to 1.7 percent.
The price for Brent crude oil, the global benchmark for the price of oil, was down 0.5 percent as of 9:15 a.m. EST to $62.13 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was off from the previous session's close by 0.78 percent to $56.16 per barrel.
U.S. oil has been a spoiler for OPEC's effort to balance the market and the IEA said Thursday it raised its 2017 forecast for gains to 370,000 barrels per day this year and 870,000 barrels per day for next year.
U.S. oil production is accelerating and a 2015 end to a ban on exports means more of it is on the open market. Oil prices came under pressure Wednesday, however, after federal data showed a build in gasoline inventories, a possible indication of declining demand. Consumer prices for fuel and fuel-related products are rising faster than any other sector.
The U.S. Labor Department, meanwhile, reported first-time claims for unemployment for the week ending Dec. 9 was lower than the previous week by 11,000, though some of last weeks' data were revised higher.
Elsewhere, pipeline operator Ineos said a crack on the Forties pipeline system, which carries about 40 percent of the oil from the North Sea, has stabilized, though it will still be a matter of weeks, not days, before the network is back up and running.