IEA Raises 2010 Global Oil Demand Outlook, Maintains 2011 View

Global oil demand growth is expected to increase a little this year but slip in 2011, as fuel stockpiles surge and concern persists that world economic growth could falter, the International Energy Agency said on Friday, according to media reports.

Global crude demand will average 87.9 million barrels a day next year, the IEA said in its monthly Oil Market Report, unchanged from last month. It revised the 2010 estimate up by 50,000 barrels a day to 86.6 million.

But the amount of unused oil in industrialized nations neared a record high as of July. Oil stockpiles rose to the equivalent of 61.4 days of forward demand by the end of July, from 61.0 days at the end of June. And OECD industry stock levels rose by 19.0 million barrels to 2.785 billion barrels in July to near-record high levels recorded in 1998, it said.

And while stockpiles are soaring, Asian consumption slowed and concerns grow over the strength of the global economic recovery and its effect on demand. While world demand will climb 1.3 million barrels a day, or 1.5% in 2011, this is down from this year's growth of 1.9 million barrels a day, or 2.2%, the IEA said.

The high stock levels and doubts about the economy indicate that crude prices are likely to remain at the same level for some time as global oil supply is more than sufficient to meet current and expected demand. Oil prices have remained at $70 to $85 a barrel since June.

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garyrjas

OPEC will just cut production a little and that will be that. This happens all the time when oil prices start to fall, it happened in the 90's and it will happen again. It has little to do with demand. I doubt 2011 will show a decrease. In fact, these stats are as of July, and we are already starting to show growth for the remainder of the year as of August and now Sept. More nonsense. Read Jim Cramer's getting back to even. In it he highlights the fact that all of these people who predict this crap are mostly snake oil salesmen.

September 10 2010 at 4:48 PM Report abuse rate up rate down Reply
jimandmars

Man that is great statement. Deman for oil may go down if economy continues slow down. Brain trust figured that out.

September 10 2010 at 11:54 AM Report abuse rate up rate down Reply