Global oil markets will “move close to balance” in the secondhalf of the year as lower prices take their toll on productionoutside OPEC, the International Energy Agency said.

The world surplus will diminish to 200,000 barrels a day inthe last six months of the year from 1.5 million in the first half,the agency said in a report on Thursday. Production outside theOrganization of Petroleum Exporting Countries will decline by themost since 1992 as the U.S. shale oil boom falters. The glut isalso being tempered as Iran restores exports only gradually withfinancial barriers to sales persisting even after the lifting ofinternational sanctions.

“There is no doubt as to the direction of travel for thesupply-demand balance,” the Paris-based adviser to industrializednations said. “There are signs that the much-anticipated slide inproduction of light, tight oil in the U.S. is gathering pace.”