IEA cuts again world oil demand growth

LONDON – The International Energy Agency (IEA) yesterday trimmed further its forecast for global oil demand growth next year, predicting lighter US consumption and an easing in demand for Opec crude.

But it said there was still a risk of tighter supplies and that winter weather could jeopardise plans for new non-Opec production. There was also a chance of disruption in the United States, where the hurricane season has around six weeks to run.Since it first issued a forecast in July for next year’s world oil demand, the IEA, which advises 26 industrialised nations, has pared back its prediction from an increase of 1,57 million barrels per day to growth of 1,45 million bpd.After initially revising the figure upwards, in last month’s report, the IEA shaved the figure by 100 000 bpd and this month by 90 000 bpd.Outright world oil demand for 2007 was seen at 86 million bpd, following the International Monetary Fund’s cut last month in its forecast for US economic growth to 2,9 per cent, down 0,4 per cent from its previous forecast.Oil prices have fallen from peaks of more than US$78 a barrel in July and August to less than US$60, prompting the Organisation of Petroleum Exporting Countries to hold talks on cutting its output by one million bpd.Prices were again falling early yesterday to near eight-month lows as the market waited for Opec to make a decision.With or without Opec cuts, there was still a chance of price rises and much could depend on the weather.”The risks look to be predominantly skewed to the upside over the coming months,” said Lawrence Eagles, head of the IEA’s Oil Industry and Markets division.So far mild temperatures in the northern hemisphere have meant refined oil product prices have led the oil complex lower as consumers use less heating fuels.Barring the unexpected, the IEA predicted the call on Opec crude would not be “vastly different” over the next six months.It left the demand for Opec crude for the fourth quarter of this year unchanged at 29,5 million bpd and for the first quarter at 29 million bpd.That, however, would mark a roughly 800 000 bpd drop from current Opec production.Opec’s supply in September fell by 155 000 bpd from August to 29,81 million bpd, as Saudi Arabia, Iran and Nigeria reduced output, the IEA said.It pared back its forecast for non-Opec supply growth by 120 000 bpd to 1,68 million bpd, compared with its September report.There was also a chance of disruption in the United States, where the hurricane season has around six weeks to run.Since it first issued a forecast in July for next year’s world oil demand, the IEA, which advises 26 industrialised nations, has pared back its prediction from an increase of 1,57 million barrels per day to growth of 1,45 million bpd.After initially revising the figure upwards, in last month’s report, the IEA shaved the figure by 100 000 bpd and this month by 90 000 bpd.Outright world oil demand for 2007 was seen at 86 million bpd, following the International Monetary Fund’s cut last month in its forecast for US economic growth to 2,9 per cent, down 0,4 per cent from its previous forecast.Oil prices have fallen from peaks of more than US$78 a barrel in July and August to less than US$60, prompting the Organisation of Petroleum Exporting Countries to hold talks on cutting its output by one million bpd.Prices were again falling early yesterday to near eight-month lows as the market waited for Opec to make a decision.With or without Opec cuts, there was still a chance of price rises and much could depend on the weather.”The risks look to be predominantly skewed to the upside over the coming months,” said Lawrence Eagles, head of the IEA’s Oil Industry and Markets division.So far mild temperatures in the northern hemisphere have meant refined oil product prices have led the oil complex lower as consumers use less heating fuels.Barring the unexpected, the IEA predicted the call on Opec crude would not be “vastly different” over the next six months.It left the demand for Opec crude for the fourth quarter of this year unchanged at 29,5 million bpd and for the first quarter at 29 million bpd.That, however, would mark a roughly 800 000 bpd drop from current Opec production.Opec’s supply in September fell by 155 000 bpd from August to 29,81 million bpd, as Saudi Arabia, Iran and Nigeria reduced output, the IEA said.It pared back its forecast for non-Opec supply growth by 120 000 bpd to 1,68 million bpd, compared with its September report.