(Ecofin Agency) - The Chief of the International Energy Agency (IEA) Fatih Birol has revealed that world oil demand will rise by 1.2 million bpd in 2016.

According to Birol, oil production by non-OPEC members may fall by 700,000 bpd as the level of production from members of the Organization of Petroleum Exporting Countries (OPEC) has attained the record level. “I think the trend is that there's a decline of stocks worldwide and the stock building rate is slowing down considerably, and we expect towards the end of this year stock draw will start to kick in," he said. He added that oil prices might have reached theirs low point and could be in the early stage of an upward trend, Kaztag news reports.

Oil prices rose on Tuesday. The international Brent crude benchmark LCOc1 was trading at $46.04 per barrel while the US West Texas Intermediate (WTI) crude futures CLc1 were 20 cents up at $44.98 a barrel. “It may well be the case, but it will depend on how the global economy looks like. In a normal economic environment, we will see the price direction is rather upwards than downwards. We believe under normal conditions towards the end of this year, second half of this year but latest 2017, markets will rebalance,” Birol added.

Crude oil prices has been fluctuating since mid-2014 driven by the oversupply in the market and the failure by oil producers to arrive at a decision to freeze or cut output.

The Chairman of Strategy and Energy Policy and the Editor of Arab Oil & Gas, Francis Perrin, had told Agence Ecofin that the prices could continue to fall but producers will be helped by the increase in world oil demand and the fall in non-OPEC oil supply in 2016.

Anita Fatunji