Paris, France — ESI-AFRICA.COM — 14 September 2011 – The International Energy Agency has cut global oil demand forecasts for this year and next, as the international economic recovery falters.
The agency reduced its estimate for 2012 consumption by 400,000 barrels a day, and for 2011 by 200,000. “Worldwide demand will rise by 1.2% to 89.3 million barrels a day this year and by 1.6% to 90.7 million next year. The full resumption of Libyan exports following the ousting of Muammar Qaddafi will be long and difficult,” it added.
“Global oil demand continues to expand at only a tepid pace,” the IEA said in its monthly Oil Market Report. “There are certainly growing concerns about the health of the global economy.”
Brent crude futures have dropped 11% from a 2011 peak of US$127.02 a barrel reached in April, as Europe’s sovereign debt crisis spreads and global manufacturing slows. Brent fell below
US $112 today, following the release of the report.
“Worldwide gross domestic product will expand by 4.2% next year, less than the 4.4% previously expected,” the agency said.
“The IEA is more bearish than before, but I’m a little more pessimistic,” said Christophe Barret, a London-based analyst at Credit Agricole CIB, whose prediction for 2011 demand growth is 200,000 barrels a day less than the agency’s forecast. “The demand side will be weak. The impact of prices on growth is starting to show with the slowdown in economic activity.”
The IEA predicted a slower resumption of output in Libya than OPEC. “The North African nation will likely restore output to 350,000 to 400,000 barrels a day by the end of this year, from zero last month,” according to the IEA. OPEC forecasts that Libya could reach a million barrels a day within six months and full capacity within 18 months.