Mr. Rumhy said, “This is a commodity that if you have 1 million barrels a day extra in the market, you just destroy the market”.
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Brent crude rose 9 cents to $47.28 a barrel, while U.S. crude went up 23 cents to $44.10 a barrel, Reuters reported.
According to the IEA, the plunge in oil prices has squeezed investment in supply while feeding demand, both factors that are beginning to push the market toward a rebalancing, and eventually, a return to higher oil prices.
IEA Executive Director Fatih Birol told CNBC the organization did not think a world in which the price of oil was stuck at $50 for “many many years” was a likely scenario.
After 2020, the IEA suggested that investments in alternative energy, cuts to oil subsidies and energy efficiency policies will dampen future increases in oil demand.
Spending for exploration and production has fallen more than 20% in 2015, but the IEA cautioned against more cutbacks.
“Crude oil imports should be well supported by the completion of new storage facilities by independent oil players in China, as authorities open up the refining sector”, ANZ analysts said of China in a note.
The agency does not see oil prices reaching $80 a barrel until 2020, but says it is also considering situations where the price could stay lower for much longer.
The IEA projects that India, not China, will be the biggest driver of global oil demand growth in coming years.
Oil prices have edged higher, ending a four-day losing streak, as traders weighed a bearish price outlook from the IEA and a lowered United States estimate for crude production. Although the IEA has made cuts in investment, annual demand growth is still struggling to exceed 1 million barrels per day.
But BNP Paribas said it expected Opec to continue pumping for market share.
“In the low-oil price scenario, the Middle East’s share in the oil market ends up higher than at any time in the last forty years”, the report said.
Prices fell from above $100 per barrel in June 2014 to their lowest level in six and half years in August 2015, trading below $42 a barrel.
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Crude oil declined Wednesday morning falling 43 cents to trade at 43.78 after a surprise climb in stocks as reported by the American Petroleum Institute after markets closed on Tuesday.
