HOUSTON, Oct. 9 -- In its October Oil Market Report, the International Energy Agency has revised upward its global oil demand forecast.
IEA revised upward by 200,000 b/d its global oil demand forecast for 2009 and by 350,000 b/d for 2010, given more optimistic economic prognoses from the International Monetary Fund and stronger preliminary data in North America, Asian countries outside the Organization for Economic Cooperation and Development, and Latin America.
Global oil demand now is forecast to average 84.6 million b/d in 2009 and 86.1 million b/d in 2010. This implies a contraction of 1.7 million b/d this year and growth of 1.4 million b/d next year.
In its new World Economic Outlook, IMF trimmed the expected 2009 global economic contraction to 1.2% from 1.4% in its last complete outlook in April, based on stronger-than-expected performance in Asia. The 2010 global GDP growth level, now set to climb 3.1%, is 1.2 percentage points higher than forecast in April, with expectations for North America and Asia upgraded.
Despite revising its outlook upward, IEA notes that prompt oil demand remains depressed. Global demand was down by 1.6% in July from a year earlier vs. a 2.3% decline as previously estimated, and down by 1.7% in August.
“More significantly, demand among the world’s twelve largest oil consumers (those using at least 1.5 million b/d), which collectively account for about 70% of the world total, is still contracting by roughly 2% on a yearly basis,” IEA said.
“Gas oil demand, in particular, remains very weak, trailing by about 4% below last year’s levels on a quarterly basis. Nonetheless, the pace of demand contraction is clearly easing, auguring a return to year-on-year growth by 4Q09. But, as noted, the contraction in 2009 as a whole will be significant; meanwhile, despite the expected 2010 rebound, oil demand next year will still remain below 2008 levels. From that perspective, at this juncture the absolute level of oil demand, rather than its relative change, is more instructive when outlining market fundamentals,” IEA said in the report.
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