OPEC today cautioned that a sustained increase in oil prices above their current level could erode crude demand next year amid a shaky global economic recovery.
Citing continuing signs of a global economic recovery, the Organization of the Petroleum Exporting Countries — supplier of about 35 percent of the world’s crude oil — revised its estimate for 2010 global demand growth to 750,000 barrels per day. That’s up slightly from its 700,000 barrels per day estimate the previous month.
“Although most of signs are pointing toward higher oil demand,” OPEC said in its November Monthly Oil Market report, “a potentially weak economic recovery along with higher oil prices are the two main factors that may dampen world oil demand in the coming year.”
“Should prices increase and be sustained above the current level, oil demand growth will be pushed down by more than 1 percent in the OECD countries,” the report said, referring to the Organization of Economic Cooperation and Development.
The cautiously optimistic projection of rebounding demand underscores the uncertainty lingering in the world energy market.
While oil prices have more than doubled since plummeting to the low-$30s per barrel late last year, the world is still far emerging completely from its worst recession in over six decades. The crisis battered oil demand, depriving bloc members of sales of their chief export and source of government revenue. (AP)
