OPEC Cuts Oil Demand Forecast Through 2012

Posted August 9th, 2011 at 2:20 pm (UTC-5)
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The oil-producing cartel OPEC is cutting its forecast for the amount of oil the world is likely to consume through next year.

The Organization of the Petroleum Exporting Countries said Tuesday that as the global economic recovery loses momentum, countries around the world will use less oil. OPEC said economic “dark clouds” are already affecting the oil market.

OPEC, which accounts for 40 percent of the world's oil production, cut its previous consumption forecast for the rest of this year by 150,000 barrels of oil a day, and by 20,000 next year.

Even with the new forecast, OPEC said global demand would increase this year by 1.2 million barrels a day, to more than 88 million barrels a day. The overall consumption figure is expected to increase again next year, to more than 89 million barrels a day.

As the world's financial markets have been roiled in recent days by fears of another global economic downturn, the price of crude oil has dropped. With economies in some of the world's developed countries advancing sluggishly, oil traders assume there will be less demand for oil, and thus the price of the commodity has fallen.

Crude oil on New York markets has dropped to about $80 a barrel, down 28 percent from a two-year high reached in early May.