As oil prices climb close to $90/B, the IEA warns that global oil markets “could be in for another volatile year in 2022” due to the combination of shrinking global inventories and fast-falling spare capacity. This is a marked contrast to one month ago, when the IEA announced that “as 2021 draws to a close, the oil market appears to stand on a better footing than it has for some time.”

In its first monthly report of the year, the IEA revised up its expectations for 2022 global oil demand by 170,000 b/d (see table 1). The IEA attributes the move to the more muted impact that rising Covid-19 cases are having on oil consumption amid the Omicron-variant wave. The upwards revision was heavily weighted to Q4. (CONTINUED - 813 WORDS)