OPEC revises 2010 oil demand forecast up on petchem growth

13 October 2009 12:27  [Source: ICIS news]

By Alex Davis

OPEC revises 2010 oil demand forecast upLONDON (ICIS news)--OPEC has revised its global oil demand growth forecast up for 2010 by 200,000 bbl/day, with increased consumption expected to come from the petrochemical sector as well as from transport and industry, the organisation said in its monthly oil report on Tuesday.

The new demand growth forecast for 2010 now stands at 700,000 bbl/day. The 2009 forecast has also been revised upwards by 200,000 bbl/day to -1.4m bbl/day.

This compares to the IEA’s recent demand growth forecasts of -1.7m bbl/day for 2009 and +1.4m bbl/day in 2010.

“The bulk of next year’s demand growth will take place in the non-OECD countries, mainly China, the Middle east, India and Latin America,” the report said.

OPEC made clear in the report that these upward revisions were far from certain, given the lack of bullish market fundamentals.

“Until there is a clearer picture about the pace of the global recovery, the outlook for oil and other commodities will continue to be highly dependent on economic signals.

“Given weak oil market fundamentals as reflected in high global inventories and large OPEC spare capacity, there is a need for continued close monitoring of both economic conditions and developments in the oil market,” the organisation said.

The demand for OPEC crude oil was revised upward by 100,000 bbl/day to 28.6m bbl/day for 2009. This was, however, still a considerable decline of 2.3m bbl/day year-on-year. For 2010, demand was revised upward by 300,000 bbl/day to 28.4m bbl/day.

The OPEC reference basket fell by 5.9% in September to reach $67.17/bbl, following bearish developments in equities markets earlier in the month. Going into October, a weakened dollar pushed the basket price up to $67.63/bbl in the week ending 9 October, from $65.75/bbl the week before.

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