The Organization of Petroleum Exporting Countries slightly lowered this year's forecast for world oil demand growth, noting oil consumption in industrialized countries has been very weak, while high oil prices and a slowing economy would likely weigh on U.S. demand for gasoline this summer.
OPEC, however, dispelled the need for any larger cut to its growth forecast, which is driven primarily by demand from developing economies, saying it also believed the global credit crisis may be easing and the U.S. economy hadn't yet entered a recession as feared.
In its monthly oil market report released Thursday, OPEC said world oil demand growth, a key indicator closely followed by the global crude market, had been revised down by 40,000 barrels a day to 1.16 million barrels a day. In percentage terms, 2008 world oil demand is now expected to grow at 1.35% compared with its previous estimate of 1.4%.
That means OPEC, which supplies more than 40% of the world's oil needs, is now forecasting faster oil demand growth than the International Energy Agency, the Paris-based energy watchdog of major industrialized countries. The IEA Tuesday cut its world oil demand growth forecast for the second consecutive month to 1 million barrels a day, or 1.2% growth.
"World economic growth is forecast at 3.9% in 2008, unchanged from the previous month amid signs that the credit crisis may be easing," OPEC said in its report.
It also said technically speaking "the U.S. is not yet in recession," noting the U.S. economy is expected to have grown in the first quarter at a sluggish pace of 0.6%.