IEA lifts global oil demand outlook
Source: Bloomberg News |
January 19, 2013, Saturday
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Print Edition
Print Edition
THE International Energy Agency raised forecasts for global oil demand this year because of stronger growth expectations for China and said the world oil market is "tighter" than previously estimated.
"All of a sudden, the market looks tighter than we thought," the Paris-based agency said yesterday, boosting its 2013 global demand forecast by 240,000 barrels a day. World consumption will increase by 900,000 barrels a day, or 1 percent, this year to average a record 90.8 million. Saudi Arabia, the world's largest exporter, reduced production from its highest in 30 years, and inventories in developed economies are contracting after accumulating in much of 2012, according to the IEA.
"China has been doing quite a bit of growth-supportive policy," Amrita Sen, chief oil market strategist at research consultant Energy Aspects Ltd in London, who predicts the IEA may further increase its demand forecast for the country. "Clearly there's an underlying momentum" in the nation's consumption, she said.
Economic growth in China, the world's second-biggest economy, accelerated in the fourth quarter for the first time in two years amid government measures to revive demand.
China will use 390,000 barrels a day, or 4 percent, more oil this year than in 2012, to reach 10 million a day, according to the adviser to energy-consuming nations. That's 135,000 more than previously predicted. The nation's gross domestic product expanded by 7.9 percent in the fourth quarter from a year earlier, the National Bureau of Statistics said yesterday.
"Recent bullish readings have signaled the potential for a rebound" in China's economy, the IEA said in its monthly oil market report. Global oil demand growth remains "relatively restrained," the IEA said.
The Organization of Petroleum Exporting Countries cut output to the lowest in a year in December, curbing supplies by 265,000 barrels a day to 30.65 million, the IEA estimated. Saudi Arabia, the group's biggest member, cut output by 290,000 barrels a day to 9.4 million as domestic use dropped.
Even after the drop, OPEC is producing 650,000 barrels a day more than the average of 30 million it will need to provide in 2013, the IEA said.
"All of a sudden, the market looks tighter than we thought," the Paris-based agency said yesterday, boosting its 2013 global demand forecast by 240,000 barrels a day. World consumption will increase by 900,000 barrels a day, or 1 percent, this year to average a record 90.8 million. Saudi Arabia, the world's largest exporter, reduced production from its highest in 30 years, and inventories in developed economies are contracting after accumulating in much of 2012, according to the IEA.
"China has been doing quite a bit of growth-supportive policy," Amrita Sen, chief oil market strategist at research consultant Energy Aspects Ltd in London, who predicts the IEA may further increase its demand forecast for the country. "Clearly there's an underlying momentum" in the nation's consumption, she said.
Economic growth in China, the world's second-biggest economy, accelerated in the fourth quarter for the first time in two years amid government measures to revive demand.
China will use 390,000 barrels a day, or 4 percent, more oil this year than in 2012, to reach 10 million a day, according to the adviser to energy-consuming nations. That's 135,000 more than previously predicted. The nation's gross domestic product expanded by 7.9 percent in the fourth quarter from a year earlier, the National Bureau of Statistics said yesterday.
"Recent bullish readings have signaled the potential for a rebound" in China's economy, the IEA said in its monthly oil market report. Global oil demand growth remains "relatively restrained," the IEA said.
The Organization of Petroleum Exporting Countries cut output to the lowest in a year in December, curbing supplies by 265,000 barrels a day to 30.65 million, the IEA estimated. Saudi Arabia, the group's biggest member, cut output by 290,000 barrels a day to 9.4 million as domestic use dropped.
Even after the drop, OPEC is producing 650,000 barrels a day more than the average of 30 million it will need to provide in 2013, the IEA said.
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