OPEC cuts 2011, 2012 oil demand forecast

The OPEC group of petroleum exporting countries slightly lowered its forecast Tuesday for 2011 and 2012 crude oil demand, citing concerns for the economic health of developed countries. In its monthly report, the cartel said demand for crude was expected to reach 88.14 million barrels per day (mbd) in 2011, down from a previous estimate of 88.18. The new figure represented a demand rise of 1.2 mbd from 2010. For 2012, OPEC now forecasts a demand of 89.44 mbd, down from a previous forecast of 89.50 mbd. "Economic worries along with high oil prices have affected OECD oil demand, leading to weaker-than-expected consumption during the summer driving season," said the group, whose members provide about 35 percent of the world's crude oil and has more than three-quarters of its reserves. "Oil demand in the OECD is expected to continue its contraction after a temporary rebound last year." The situation in the United States, which saw its "AAA" credit rating downgraded on Friday by Standard & Poor, was cited as a particular concern. "Should the situation see further deterioration in the US, then aggregate oil demand will see a further decline this year," said OPEC of the world's biggest oil consumer.