10 May 2012, Sweetcrude, VIENNA – The Organisation of the Petroleum Exporting Countries, OPEC, has revised its 2012 world oil demand outlook slightly upwards, citing a stable US economy and the shutdown of nuclear plants in Japan, which boosted demand.
OPEC on Thursday predicted 2012 demand at 88.67 million barrels per day (bpd), up 0.90 million bpd from 2011, in its latest monthly report.
This represented a minor hike from its previous estimate in April which stood at 88.64 million bpd.
“Given the stabilisation of the US economy and the shutdown of Japanese nuclear power plants, world oil demand growth has — at least for the short-term — stopped its declining trend and is showing some growth,” OPEC said.
Demand outside the OECD developed countries was higher while those such as India and Saudi Arabia were consuming more than expected, it added.
However, Europe’s economic worries continued to hurt demand, OPEC said, warning that high oil prices in the US could also have a dampening effect on the approaching summer driving season.
“The most important sector (in the US), transportation, continues to consume less oil than it did last year, due mainly to the country’s economic activity and high retail prices,” the report said.
With economic developments and fuel prices uncertain, “the outlook for US oil consumption for the entire year remains rather pessimistic,” it added.
World oil demand could also be impacted by events in Japan, which switched off its last working reactor on Saturday amid a debate over whether the country should retain nuclear power in the wake of the Fukushima disaster last year.
“Should Japan restart its nuclear plants, the country’s high oil-usage would slow down dramatically,” OPEC said.
The 12-member cartel, which accounts for about a third of global oil supply, pumped some 31.62 million bpd in April, up 0.32 million bpd from March, with members Iraq, Libya, Saudi Arabia, Nigeria, and Angola hiking production.
Iran on the other hand saw output drop, OPEC said, citing secondary sources.
On Thursday, oil prices slipped as a sharper-than-expected US stockpile gain further spooked nervous investors already shaken by worries over the eurozone in the wake of French and Greek elections, analysts said.
New York’s main contract, light sweet crude for delivery in June, dipped 12 cents to $96.69 per barrel in the afternoon and Brent North Sea crude for June shed 39 cents to $112.81.