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OPEC maintains estimate for world oil demand in 2008

VIENNA - OPEC on Tuesday left unchanged its estimate for growth in 2008 world oil demand, arguing that while high oil prices would brake demand in major industrialised countries, the market for crude would be strong elsewhere.

‘World oil demand is forecast to grow by 1.3 million barrels per day (bpd) in 2008 to average 87.07 million bpd, unchanged from our last estimate,’ the Organisation of Petroleum Exporting Countries said in its January monthly report.

‘The effect of high oil prices on consumers might have a moderate impact in the short run. Hence, transport fuel consumption if not on the decline, will be flat,’ it said.

However, that effect would be diluted ‘especially in regions that represent a large share of world oil demand this year because of price subsidies that shield consumers, such as in China, India, and OPEC member countries,’ the cartel said.

OPEC also left unchanged its estimate for world oil demand growth in 2007, when it was projected to have risen by 1.2 million bpd or 1.4 percent to average 85.77 million bpd.

Cold weather was ‘increasing oil demand in the Northern Hemisphere,’ OPEC said.

‘Data show that temperatures in North America and Europe were colder than normal last December. Cold winter not only increased heating oil consumption but also boosted natural gas prices which, in turn, discouraged power plants from using gas as a fuel,’ it explained.

‘However, the weather in the Pacific remained mild, causing low kerosene demand,’ it added.