Global oil demand to stay below last years levels until 2013 agency predicts
By Alexandra Stadnyk
The International Energy Agency cut its five year forecast for crude demand blaming the global economic downturn for decreasing oil demand, the agency said on Monday.
“The global financial crisis has turned the economic landscape upside down, with huge implications for the oil and gas sector,” said Nobuo Tanaka, Executive Director of the IEA.
The IEA cut its oil demand estimates for every year through 2013 by about 3 million barrels a day, it said in its Medium- Term Oil Market Report. Consumption will average 86.76 million barrels a day in 2012, the first year it will rise above 2008’s level of 85.76 million barrels a day, according to the Paris-based agency.
“Oil prices are around half the level seen last year in July, when they peaked at $147, even though they have strengthened again recently, partly due to a perception that economic recovery may be just around the corner,” Mr. Tanaka said, warning that if oil prices rose too rapidly it could damage any such recovery.
“In the natural gas sector, we have moved from a tight supply and demand balance with extremely high gas prices to an easing one with plummeting prices. Both markets face enormous uncertainty surrounding the timing, pace and extent of any economic rebound, which affects all prognoses for oil and gas market fundamentals over the next five years.”