Tags: OPEC | Oil | crude | Demand

OPEC Cuts Oil Demand Forecasts for 2011, 2012 as Economy Falters

Tuesday, 09 Aug 2011 08:16 AM

The Organization of Petroleum Exporting Countries cut its oil demand forecasts for 2011 and next year as the global economic recovery loses momentum.

OPEC, responsible for about 40 percent of world oil supply, reduced its consumption estimate for this year by 150,000 barrels a day. That means global demand will rise by 1.2 million a day, or 1.4 percent, to 88.1 million a day. Next year it will increase by 1.5 percent to 89.4 million, following a “minor downward revision,” the organization said today in its monthly market report.

“Dark clouds over the economy are already impacting the market’s direction” while developed nations “are struggling with rising sovereign debt and high unemployment,” the organization’s Vienna-based secretariat said. “Industrial activity is evidently slowing down at the global level.”

Oil fell to the lowest in more than 10 months in New York today and Brent dipped below $100 a barrel in London following the U.S. credit-rating cut and amid signs of rising crude stockpiles. OPEC has no plans “so far” to hold an emergency meeting, a delegate, who declined to be identified because he isn’t authorized to speak publicly, said today.

OPEC’s 12 members boosted production by 400,000 barrels a day last month to an average of 30.07 million a day, according to the report. That’s nearly 1 million a day less than the average amount the group forecasts its members will need to provide during the third quarter. This “call on OPEC” is estimated at 31 million a day in this quarter and 30.74 million in the fourth.

Output Gain

Most of the output gain in July was accounted for by Saudi Arabia, the group’s largest member, and Angola. Production declined in Iran, Iraq, Libya and Nigeria.

Saudi Arabia, which has pledged to help compensate for the loss of exports during the conflict in Libya, bolstered supplies by 255,000 barrels a day to 9.75 million last month, the group’s data showed.

OPEC trimmed its estimates for supplies from outside the organization this year, and kept them unchanged for 2012. Non- OPEC nations will bolster production by 600,000 barrels a day to 52.8 million, it said. That’s 50,000 a day less than predicted last month, as a result of lower projections for Canada, Norway, the U.K., Malaysia, Vietnam and Brazil. Next year non-OPEC nations will raise output by 730,000 a barrels a day to 53.57 million, according to the report.

OPEC’s members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. The organization is next due to meet on Dec. 14 in Vienna.

The International Energy Agency, an adviser to oil- consuming nations, will release its own monthly report on supply and demand tomorrow.

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The Organization of Petroleum Exporting Countries cut its oil demand forecasts for 2011 and next year as the global economic recovery loses momentum.OPEC, responsible for about 40 percent of world oil supply, reduced its consumption estimate for this year by 150,000 barrels...
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2011-16-09
Tuesday, 09 Aug 2011 08:16 AM
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