OPEC revises 2010 world oil demand growth up, 2011 unchanged

12 October 2010 12:31  [Source: ICIS news]

LONDON (ICIS)--OPEC revised up world oil demand growth for 2010 by 0.1m bbl/day in its latest report on Tuesday, while leaving the forecast for 2011 unchanged.

Demand growth this year was at 1.1m bbl/day, up from last month’s report due to a “stronger-than-expected, stimulus-led economic growth in the first half of the year,” the group said.

In 2011 global oil demand was forecast to grow by 1m bbl/day, unchanged from the September forecast, OPEC said in it’s October monthly report.

On prices, the report perceived the current level to be just right as it was high enough to encourage investment while not too high to hamper the economic recovery.

“There is now a broad consensus in the market that crude oil prices around the current range have been accommodative in promoting adequate investment while at the same time supporting the economic recovery.”

However, the report pointed to a steady economic recovery in maintaining the current level of prices.

“The uncertain pace of global growth, as well as weak conditions in oil market fundamentals could pressure prices. While fiscal stimulus is coming to an end in almost all economies, monetary easing is expected to continue.”

Non-OPEC oil supply was expected to increase by 1.0m bbl/day in 2010, up by 0.1 mb/d from the previous month, mainly due to higher-than-expected supply from Canada, Mexico and China, the report said.

In 2011, it forecast that non-OPEC oil supply would grow 360,000 bbl/day, supported by anticipated growth in Brazil, Canada, Azerbaijan, and Kazakhstan.

Meanwhile, crude oil futures were trading in negative territory on the back of a stronger US dollar against the euro and expectations that OPEC was likely to maintain output unchanged at its next meeting on 14 October.

At GMT 10:45 November Brent was trading at $82.91, down $0.81/bbl from the previous close, while November WTI was at $81.38/bbl, down $0.83/bbl.

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By: Giovanni Coiro
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