IEA Cuts 5-Year Oil Outlook

Crude oil futures are slightly higher this morning even after the International Energy Agency said oil consumption likely won’t reach last year’s levels until 2012, the organization said in its Medium Term Oil Market Report. According to Bloomberg, the Paris-based agency cut its oil demand estimates for every year through 2013 by approximately 3 million barrels a day because of the deep economic recession in developed economies as well as slowed growth in China and India.

Average oil consumption will stay below 85.76 million barrels a day and won’t break that mark until 2012. This reduced demand is postponing the threat of a supply shortfall, the IEA said. Relative to medium-term profiles in previous years, “this scenario paints a delayed picture of a threatened ‘supply crunch’ later in the period.”

From the Bull Pen: For oil bulls shrugging off this news, consider small cap oil and gas company Rosetta Resources (ROSE). One option is to start an initial position here and buy on a pullback towards $8.50. A sell stop can be set below $8.

From the Bear Cave: Is the IEA forecast implying an L-Shaped recovery? Those playing the downside on the broader markets can use the S&P 500 depository receipts (SPY) with short term buy stops above the 20 DMA (currently $92.90).

Quick Check Around the World

Asian trading closed with the Hang Seng -0.39%, India 0.14%, Shanghai 1.61%, Nikkei -0.95%, and Taiwan -1.12%.

Glancing towards Europe, we see the FTSE 0.43%, CAC 1.19%, DAX 1.15%

As of 8:10 AM EST, S&P Futures are trading +3.40 to 917.30 and Nasdaq futures are +8 to 1480.20.

A Look at Commodities

Over in commodities, crude oil is trading +0.73 to 70.42 while gold is +0.80 at 941.80 this morning. Silver is -0.480 to 14.08 and copper +1.35 to 230.70.

The dollar index is +0.0550 to 80.1600.

No economic events on the radar today. But click here for events for the rest of the week.

Happy Monday! Good luck and have a great day!