Oil prices have been through a period of volatility and decline for more than a year now, with benchmark Brent crude falling from a peak price of $114 a barrel in June 2014 to trade around $50 a barrel this week.
The IEA questioned when a rebalancing of the glut in supply and lack of demand could take place. Producers hoping the oil price will recover could be disappointed.
"Oil at $50 a barrel is a powerful driver in rebalancing the global oil market, but the big question is just when will equilibrium be restored?"
"To be sure, the world is using more oil and high-cost supply -- primarily non-OPEC -- is being forced out. But a projected marked slowdown in demand growth next year and the anticipated arrival of additional Iranian barrels – should international sanctions be eased – are likely to keep the market oversupplied through 2016."
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For now, lower oil prices are supporting strong demand growth currently, the IEA said, but that trend was expected to change.
"The outlook for oil demand growth is looking softer next year. The International Monetary Fund, in its latest World Economic Outlook, cut 0.2 percentage points from 2015 and 2016 economic growth, with big markdowns in oil-dependent economies, such as Canada, Brazil, Venezuela, Russia and Saudi Arabia."