"Stockpiles of oil at a record 3 billion barrels are providing world markets with a degree of comfort," the IEA said in a monthly report, adding that brimming stocks offer an unprecedented buffer against geopolitical shocks or unexpected supply disruptions.
Oil prices have more than halved in the past 18 months with supply bolstered by U.S. shale oil output and OPEC's refusal to cede market share.
The IEA said global oil supplies breached 97 million barrels per day in October, up 2.0 million from a year earlier, as non-OPEC output recovered from lower levels in the previous month.
“And even though lower oil prices will lead to a decline in US tight oil production next year, it will take months to clear the market's glut,” the IEA said.
This massive cushion has inflated even as the global oil market adjusts to USD 50 per barrel. Demand growth has risen to a five-year high of nearly 2 million bpd but gains in demand have been outpaced by vigorous production from OPEC and resilient non-OPEC supply, with Russian output at a post-Soviet record and likely to remain robust in 2016 as well, it was added in the report.
The stock overhang that first developed in the United States due to soaring production has now spread across developed nations as well as China and India.

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