OPEC sees shortfall risk in 2013

WORLD oil demand growth could fall short of forecasts next year, exporter group OPEC said yesterday, citing a vague and turbulent outlook for the global economy.

The Organisation of the Petroleum Exporting Countries (OPEC) said it expected world oil demand to expand by 810,000 barrels per day (bpd) next year, unchanged from its previous forecast, although the odds suggested demand could undershoot.

"The downward risk potential has greater probability in the forecast than the upward risk one," OPEC said in a monthly report.

"Therefore, the gloomy picture could reduce the world oil demand growth forecast by 20 per cent next year."

For this year, OPEC, which pumps more than a third of the world's oil, left its forecast for the growth in world oil use virtually unchanged at 900,000 bpd and said the outlook had flattened out.

"Demand has overcome earlier expectations of a declining momentum and moved to a more stabilised trend, supported by the summer driving season, the summer heat and the continued shutdown of most of Japan's nuclear capacity."

But the group trimmed its forecast of demand for its own oil this year and in 2013 by 80,000 bpd and 100,000 bpd, respectively, due to higher supply from producers outside the 12-member group.

OPEC, citing secondary sources, said its production fell by 160,000 bpd to 31.19 million bpd in July, led by a drop in Iran.

Iran's oil became subject to a European Union embargo from July 1.

Reuters