"Stocks have been rebuilt by quite a bit," Halff said.
In the US, crude supplies stand at 327.4 million barrels, or 8 percent above year ago levels, according to the US Energy Department, which said this week that "inventories remain well above the upper end of the average range for this time of year."
Whether the economic and political uncertainty around the globe justifies the level of fear gripping energy markets or not, analysts said the underlying factor -- the extremely thin supply cushion -- could begin to dissipate next year. New oil development projects in Saudi Arabia and in some non-OPEC countries will soon come on line, and demand growth is slowing in China and the US, they said.
PFC Energy, a Washington-based consultancy, estimates that OPEC's spare production capacity, which is currently about 1.5 million barrels per day, is on pace to rise as high as 2.7 million barrels per day a year from now. Moreover, most of the extra barrels coming from Saudi Arabia, Kuwait and Nigeria will be the light-sweet crudes that refiners prefer for the production of transportation fuels.
While not as large as the supply cushion of 3 million to 5 million barrels per day that the markets were accustomed to in the 1990s, this could be enough excess production capacity to ease traders' jitters and allow prices to begin falling.
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