By SARAH KENT
LONDON -- The International Energy Agency once again cut its
outlook for global oil demand Thursday, but warned significant
supply risks continue to threaten the market.
The downward revision by the Paris-based consumer group
reflects similar moves by other industry forecasters earlier
this week as concerns over the state of the global economy
continue to weigh on demand expectations.
In its monthly oil market report published Wednesday, the
Organisation of Petroleum Exporting Countries downgraded its
forecast of world oil demand growth by 40,000 bpd for 2013,
while the US Energy Information Administration cut its outlook
by 140,000 bpd.
In its closely-watched monthly oil market report published
Thursday, the IEA cut its expectations of oil demand growth to
795,000 bpd, down from 820,000 bpd last month.
The decline reflects
exceptionally weak demand from industrialized countries,
particularly in Europe where consumption in 2013 is expected to
be the lowest since the 1980s, the IEA said.
The bleak economic picture is reflected in demand for oil
products, with initial statistics showing that gasoline
consumption may have outpaced consumption of gasoil -- commonly
used in industrial processes -- last year and is expected to do
so again this year; helped by strong demand for the transport
fuel in China and Saudi Arabia, the IEA said.
However, gasoil demand growth is expected to outpace
gasoline demand growth once more in 2014, it added.
Since early February the price of the European benchmark
Brent crude has fallen around 10% to hover around $105/bbl, its
lowest level since November last year.
Nonetheless, the IEA warned that significant risks to the
"There are signs that some of the recent easing of upward
price pressures could be relatively short‐lived," the IEA
said in its closely-watched monthly oil market report.
For the first time in months, the agency cut its
expectations of non-OPEC supply growth for the year as
infrastructure maintenance, extreme weather and
geopolitical insecurity affected output in the first quarter of
The IEA also highlighted significant risks to OPEC
Nigerian oil production fell to a four-month low in March
and could fall further following a resurgence in
oil-theft-related damage to pipelines and renewed threats of
militant attacks against the country's oil infrastructure, the
The IEA also warned that insecurity in Libya is threatening
to derail the country's production outlook. Output fell by
40,000 bpd last month to 1.36 million bpd, according to the
IEA's data. That is 150,000 bpd lower than the official figure
provided by Libya to OPEC in its most recent report, published
Iranian output also remains constrained by strict Western
sanctions with exports falling to 1.1 million bpd in March,
down from 1.26 million bpd in February, the IEA said.
Dow Jones Newswires