Mubasher: Global oil inventories saw surprising build-ups during the first half of this year, as production cuts led by a group of the world’s top producers failed to prevent a market glut, the International Energy Agency (IEA) said.

Global supply outpaced demand at a growth rate of 900,000 barrels per day (bpd) during the period between January and June, as consumption turned weaker than expected against the backdrop of stuttering economy, according to the IEA.

“This surplus adds to the huge stock-builds seen in the second half of 2018, when oil production surged just as demand growth started to falter,” the Paris-based agency said in its monthly report.

Last week, the Organization of the Petroleum Exporting Countries (OPEC) and its partners including Russia, an alliance known as OPEC+, agreed to keep production restrained until March 2020 to limit the formation of a new glut.

The 24-nation coalition has been withholding 1.2 million bpd from the market since the start of this year, in a bid to clear a buildup of inventories that could hit prices.

However, 14-member OPEC, which slashed demand outlook for next year, could need to withhold more barrels, sending output to the lowest in 17 years to keep markets on an even keel, the Paris-based agency said.

“The widely-anticipated decision by OPEC+ ministers to extend their output agreement to March 2020 provides guidance but it does not change the fundamental outlook of an oversupplied market,” the IEA said.

By 1:03 pm GMT, US Nymex crude futures rose by 0.12% to $60.27 per barrel (pb), while global benchmark Brent futures climbed by 0.42% to $66.80 pb.