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IEA lowers oil demand forecast for 2014 and 2015 - Deutsche Bank

FXStreet (Łódź) - Jim Reid from Deutsche Bank comments on the International Energy Agency's downward revision of the oil demand projections for this and next year, due to a weaker growth outlook for Europe and China.

Key quotes

"The institution noted that global oil demand growth had slowed to below 500k bbl/day in Q2 which is a first in 2.5 years."

"We've flagged a few times now on how the recent decline in Crude oil is somewhat telling given the various geopolitical uncertainties globally and whilst a stronger Dollar may explain some of these moves, in reality demand weakness is difficult to ignore."

"Brent Futures fell over 1% yesterday morning before rallying back strongly after Russian sanctions were confirmed (see below). It’s trading around -0.2% lower overnight at around $97.80."

"Overall we've now seen a decline for seven of the last eight weeks."

"Whilst historically such falls in oil prices might be seen as an economic positive, with the world’s regions, most notably the Eurozone, fighting disinflation these developments will add to the downward pressure."

"Will this free up the ECB and slow down the Fed?"

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