No Spike in Oil Price Following IEA "Third Oil Shock" Announcement

The IEA said high prices would discourage demand for oil in the short-term, but in the medium-term, 'demand growth in developing countries and ongoing supply constraints continue to paint a tight market picture.' The IEA remains in a remarkable state of delusion about the world's ability to increase oil supply. It projects that global demand will grow from 86.8 million barrels per day this year (with supply of around 88mbpd) to 94.14mpbd in 2013. That's an increase in global production of 8.5%. Let's see. Where will that come from? Well, assuming there is no decline in current production, you could double Iraq's production, throw in 2mpbd from the Saudis and their spare capacity and new fields, chuck out Chavez and get Venezuela humming again, and bring on-stream a lot of the deep-water projects...and maybe, just maybe you'd get there.