International Energy Agency predicts weaker consumption in 2013 due to economic woes
The International Energy Agency (IEA) trimmed its estimate for growth in oil demand in 2013, becoming the third of the world's top oil forecasters this week to predict weaker consumption due to subdued economic growth.
World oil use will rise by 795,000 barrels per day (bpd) this year, the IEA, which advises 28 industrialised countries on energy, said in a monthly report on Thursday. That is 25,000 bpd less than it previously estimated.
"Overall, a slightly weaker demand trend is forecast for 2013 than in last month's report," the Paris-based IEA said.
This marked the third straight reduction in the IEA's 2013 demand growth forecast and it follows similar moves this week from the US government's Energy Information Administration and the Organization of the Petroleum Exporting Countries (OPEC).
Oil prices are trading just over $105 a barrel, down from a 2013 high of $119.17 on February 8, partly due to concerns over the strength of economic recovery. The IEA warned it was too early to call a bear market, citing supply risks.
The agency also lowered its oil supply forecast for countries outside OPEC this year for the first time in several months and said worsening security in Libya and oil theft in Nigeria had contributed to a decline in OPEC output last month.
"There are signs that some of the recent easing of upward price pressures could be relatively shortlived," the IEA said. "Crude supply risk remains elevated."
On oil demand growth, the IEA now has the lowest 2013 forecast of the three main forecasting agencies.
OPEC in a report on Wednesday estimated consumption this year will rise by 800,000 bpd, down 40,000 bpd. The EIA on Tuesday reduced its estimate by 50,000 bpd to 960,000 bpd.