MercoPress. South Atlantic News Agency

Global oil demand forecasted to drop, first time since 1983

Global oil demand will contract this year for the first time since 1983 shrinking by 200.000 barrels per day, with the total revised down to 85.8 million barrels per day according to the monthly report from the International Energy Agency.

"In 2009 demand will grow again to a downward adjusted 86.3 mb/d. This forecast is based on the IMF assumption that the global economy will gradually recover from 2009", adds the report. In its previous monthly report the IEA which advises industrialized countries on energy affairs was forecasting for 2008 and 2009, a daily demand of 86.2m and 86.5 m bpd. The reduction in demand is concentrated in developed economies in the Organization for Economic Cooperation and Development, where oil use will tumble 3.3%. Next year's growth may be wiped out if the economic slump deepens, the agency said. Oil prices have plunged more than 100 USD a barrel from a record in July as the US, Europe and Japan face their first simultaneous recession since World War II. Ministers in OPEC, responsible for more than 40% of world oil production, have said the group is likely to cut output when it meets December 17 in Algeria to shore up prices. While the agency trimmed its estimate for oil use in developing nations by 300,000 bpd in 2009, that still leaves growth of 2.9%, taking non-OECD demand to 39.4 m bpd. Chinese consumption will climb 3.7% to 8.23m bpd. The Organization of Petroleum Exporting Countries will have to provide about 30.8 million barrels a day next year to balance supply and demand, the IEA said, 200,000 barrels a day more than estimated in the previous report. The adjusted "call" on OPEC was cut by 500,000 barrels a day in the fourth quarter of this year. Supply estimates from outside OPEC were cut for this year and next because of prolonged disruptions in Azerbaijan and the Gulf of Mexico. That means non-OPEC supply in 2008 will shrink for the first year since 2005, when hurricanes battered platforms off the US coast, by 90,000 bpd to 49.6 million bpd. Next year non-OPEC production will increase by 480,000 bpd to 50.08m bpd, says the IEA report.