OPEC lowers medium-term demand forecast over eurozone

AFP, Thursday 8 Nov 2012

Oil cartel OPEC lowered on Thursday its medium-term forecast for global oil demand, citing "growing concern" about economic growth especially in the eurozone.

By 2016, demand was expected to reach 91.8 million barrels per day (mbpd), the Organisation of Petroleum Exporting Countries said in its annual World Oil Outlook report.

Last year, it had forecast average daily demand at 92.9 million barrels within four years.

OPEC said that in its last two reports it had taken a "more positive view on how quickly a recovery would occur, leading to upward revisions in medium-term oil demand prospects," based on "the extraordinary monetary and fiscal stimulus that were put in place."

It said: "This year, however, there is growing concern about immediate prospects for economic growth, particularly in the eurozone."

Risks from the region "have heightened as a result of expanding public deficits, weakening economic growth, deleveraging in the banking system, as well as policy indecisiveness," OPEC secretary-general Abdullah El-Badri added in a foreword.

While the US seemed to be faring better, slow growth in developed countries was threatening to spill over into developing countries, he warned.

OPEC also lowered its long-term oil demand forecast Thursday, seeing it average 107.3 mbpd by 2035, 2.4 mbpd lower than the 109.7 mbpd it had forecast last year.

The cartel blamed this on technological developments that would impact especially the transportation sector, as well as on higher oil prices.

Nevertheless, the forecasts in OPEC's latest report still see a hike in demand over the next two decades, with most of the growth -- in both the medium- and long-term -- due to occur in Asia.

This year, demand is expected at 88.81 mbpd, followed by 89.60 mbpd in 2013.

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