OPEC forecasts 800,000 barrel demand growth
VIENNA – The Organisation of Petroleum Exporting Countries, OPEC, has added 80,000 barrels per day to its world demand growth forecast, predicting an expansion of 800,000 barrels per day in 2013.
The oil producer group cited “some signs of recovery in the global economy and colder weather at the start of the year” for the increase to an average total of 89.7 million barrels per day.
OPEC said that the bulk of the increase would come from China, which is expected to see 400,000-barrel demand growth this year.
It is expecting non-OECD countries aside from China to add 700,000 barrels and for the OECD to shrink by 300,000 barrels.
OPEC also revised its demand growth forecast for 2012 to 800,000 barrels per day, adding 45,000 barrels to reflect higher-than-expected data.
The producing group is expecting non-OPEC suppliers to have added 500,000 barrels in supply daily in 2012 and to add 900,000 barrels this year, with the US, Canada, the Sudans, Brazil, Australia, and Kazakhstan seen as the major contributors.
OPEC left its global economic predictions unchanged at 3% growth in 2012 and 3.2% in 2013.
On prices, the group said that the US agreement averting a so-called ‘fiscal cliff’ and increasing economic optimism had triggered a rally in crude rates.
Due to higher demand, and little change in supply expectations from producers outside the group, OPEC expects demand for its crude to average 29.78 million barrels per day in 2013, up 130,000 barrels per day from the previous estimate.
While the report suggests oil markets are in surplus, it points to a narrower gap between global supply and demand in the first half of the year as OPEC further trims production towards its target level of 30 million barrels per day.
Demand for OPEC crude will average 29.20 million barrels per day in the first half of 2013, the report estimated, while OPEC in January lowered its output by about 21,000 barrels per day to 30.32 million barrels per day according to secondary sources.
OPEC’s is the first of this month’s three closely-watched supply and demand reports to be released. The US Energy Information Administration is scheduled to release its latest update later on Tuesday, while the International Energy Agency, advisor to 28 industrialised countries, issues its report on Wednesday.