Despite a slew of international crises the price of oil is unlikely to rise in the near future thanks to rising production from North America, according to the International Energy Agency's (IEA) monthly report. The advance of Islamist militants in northern Iraq and the increasingly unstable situation in Libya have put many investors on edge about the prospect of oil price hikes. While the IEA said the security of some major oil producing countries "remains more at risk than ever," oil supplies are relatively abundant. The Organisation of the Petroleum Exporting Countries (OPEC) has increased output to a five-month high 30.4m barrels per day (bpd). "Despite armed conflict in Libya, Iraq and Ukraine, the oil market today looks better supplied than expected, with an oil glut even reported in the Atlantic basin," the report said.
At the same time US oil production has climbed by over 3m bpd since 2010, with no signs of abating. US production was so impressive that the IEA went so far as call the supply growth "relentless." Back in July, research from Bank of America Merrill Lynch (BoAML) suggested that the US was leading the world in the production of oil and gas, having overtaken both Saudi Arabia and Russia in the previous six months. US oil production has surged by 70 per cent since bottoming out in 2008, while liquefied natural gas output has jumped 40 per cent since 2005. As a result, the country has become far less dependent on foreign energy, spending less than 1.5 per cent of national income on oil and gas from overseas.