A global oil glut that has sent prices tumbling is set to "shrink dramatically" later this year, as wildfires have disrupted Canada's output and demand in India soars, the International Energy Agency (IEA) said Thursday.

Demand for oil worldwide is set to grow at a "solid" rate in 2016, with India the "star performer", the 29-nation IEA said in its monthly report, adding it believed "the global supply surplus of oil will shrink dramatically later this year".