Non-OPEC Countries Alone Can More Than Account For The Jump In Demand

Non-OPEC member countries are expected to boost their combined oil supplies by 1.5 million barrels a day next year, which by itself can satisfy the expected global demand growth of 1.4 million barrels a day, CNBC reported citing a report from the International Energy Agency.

The bulk of new oil entering the market will come from U.S. shale fields, who are all taking advantage of higher oil prices that makes it more lucrative to proceed with new oil rigs and investing in shale fields.

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But Brazil, Canada, the United Kingdom, Kazakhstan, Ghana and the Congo will also contribute to a higher output as long-planned projects will ramp up and come online. On the other hand, countries like China and Mexico will see their oil outputs fall due to investment cuts in exploration and development activities.

Russia, a non-OPEC member that agreed to abide by the OPEC agreement to reduce their collective supply, will remain a question mark. The country already agreed to keep its oil output to 300,000 barrels a day below October's level, but the IEA expects Russian producers to proceed with increase spending in oil projects.

"There may be a surprise to the upside again," the agency said in reference to Russia's oil output.

Bottom line, the IEA report hints that the oil market will continue to struggle and American drillers will play a bigger role in the oil market's "drama," CNBC noted.