Global oil demand set to increase in 2013 – OPEC

12 February 2013 11:39  [Source: ICIS news]

LONDON (ICIS)--Signs of recovery in the global economy, together with the colder weather seen at the start of this year, has led OPEC to forecast an increase in world oil demand growth in 2013, the cartel said on Tuesday.

In its February monthly oil report, OPEC revised its forecast for world oil demand growth in 2013 at 800,000 bbl/day, up by 80,000 bbl/day from its January report.

“The bulk of the growth is seen coming from China, which is forecast to increase by 400,000 bbl/day,” the report said.

“Other non-[Organisation for Economic Co-operation and Development (OECD)] countries will add a further 700,000 bbl/day, while OECD demand is expected to still see a contraction of 300,000 bbl/day,” it added. 

However, OPEC warns that although a tentative recovery in the global economy is visible, a number of fiscal-related issues in developed countries remain – and are likely to impact growth over the coming months.

The cartel forecasts world economic growth at 3.0% in 2012 and 3.2% in 2013, unchanged from the previous report.

“The weak fourth quarter in the US caused growth to be revised lower, to 2.2% in 2012 and 1.8% in 2013,” the cartel added. “The eurozone is still forecast to recover to 0.1%, from a decline of 0.4% in 2012, while China continues to benefit from increasing global trade and is forecast to expand at 8.1% in 2013 and 7.8% in 2012.”

OPEC noted the agreement in the US averting the fiscal cliff triggered a rally in crude prices, along with improving confidence in the global economy.

The increasing optimism for the economic outlook also led to a wave of speculative buying in the oil futures market.

The open arbitrage to Asia and production glitches in the North Sea market have also underpinned Nymex WTI and ICE Brent prices.

Required OPEC crude for this year is forecast to average 29.8m bbl/day, the report said, indicating a decline of 300,000 bbl/day.

Non-OPEC supply in 2013, meanwhile, is forecast to increase by 900,000 bbl/day.

By: Neha Popat
+44 208 652 3214

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