In its most recent monthly Oil Market Report (OMR), the International Energy Agency slashed its oil demand outlook for 2009, and updated its demand figures for the fourth quarter of 2008.
The agency has lowered this year’s oil demand forecast based on a revised picture of the world’s economic weakness and now assumes 2009 global real gross domestic product growth of 1.2%.
A month ago, IEA based its outlook on an International Monetary Fund estimate of 2.1% GDP growth for the year.
The January OMR shows that oil demand in the Organization for Economic Cooperation and Development has been cut by 500,000 b/d from estimates in the IEA’s December OMR report. Meanwhile, oil demand in non-OECD countries has also been reduced by the same amount.
Worldwide demand for 2008 is down 100,000 b/d from previous estimates to average 85.8 million b/d, as demand in the final quarter was 300,000 b/d lower than previously estimated.
IEA also lowered its outlook for 2009 non-OECD supply, with a 100,000 b/d reduction in 2009 output from the former Soviet Union based on less-optimistic company forecasts, as well as the slower than anticipated Sakhalin-2 ramp-up. However, IEA said, declining Russian output would appear to be due more to a punitive fiscal and regulatory regime, which is impeding investment.
The Paris-based agency’s 2009 total Russian supply figure now stands at 9.7 million b/d, implying a decline of 280,000 b/d from last year.
Estimates of supplies of natural gas liquids from the Organization of Petroleum Exporting Countries in the first half of this year also have been mildly cut from a month ago. But IEA still expects OPEC NGL output to average 5.6 million b/d this year.