Bleak global economy forecasts take oil prices down

The oil prices took a downward trend last week amid bleak forecasts about sluggish global economy growth, a specialized economic report showed Saturday. The report, by Oula Wasata Brokerage Company, pointed out that the price of US crude, November delivery, fell in New York Mercantile Exchange by USD 0.21 to settle at USD 91.86 per barrel and Brent crude dropped by USD 1.09 to settle at USD 114.62 pb. It noted that the decline comes following a report by the International Energy Agency, which advises industrialized nations on energy policy, projecting a gradual easing of oil prices over the next five years due to sluggish economic growth and rising energy efficiency and as production increases steeply in Iraq and North America. The West's energy watchdog cut its global oil demand growth projection for 2011-2016 by 500,000 barrels per day (bpd) compared to its previous report in December 2011. The Paris-based IEA, though, said it expects new supply sources to more than offset any decline in rates or outages elsewhere in the world, as well as the tough international sanctions on Iran. At the same time, the spreading of refining capacity to emerging regions like Asia is expected to help offset decreases in other areas of the world. Internationally traded crude volumes are projected to decline sharply, but the IEA said product trade is forecast to growth in both volume and scope.