U.S. EIA raises 2010 world oil demand forecast

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Tue Oct 6, 2009 9:33am EDT

(Adds EIA's forecast on OPEC, non-OPEC oil production)

By Ayesha Rascoe

WASHINGTON, Oct 6 (Reuters) - The U.S. Energy Information Administration on Tuesday raised its outlook for world oil demand at the end of 2009, as the economies of China and other Asian countries begin to improve.

In its new monthly energy forecast, the agency said it now expects an increase of 410,000 barrels per day in the fourth quarter of 2009 from the same period a year ago. Its previous forecast estimated just a 240,000 bpd rise in fourth-quarter demand.

World petroleum demand is still expected to drop overall in 2009 to 83.67 million bpd, well below the 2008 level of 85.46 million bpd.

The EIA estimates world oil consumption will rebound in 2010, climbing by 1.1 million bpd compared with 2009. Last month the agency had projected a smaller increase of 910,000 bpd.

"Sustained economic growth in China and signs of a turnaround in other Asian countries continue to fuel expectations of a global recovery in world oil consumption," the EIA said.

Chinese oil demand was revised upward to 8.17 million bpd for 2009 from a previous estimate of 8.08 million bpd.

China's rapid economic growth was one of the key drivers of oil's six-year rally that sent prices up to near $150 a barrel last year.

In the United States, the world's largest petroleum consumer, oil demand is expected to fall 330,000 bpd in the fourth quarter from a year earlier.

U.S. oil consumption in 2010 was revised upward, with the EIA now expecting a 320,000 bpd increase in demand compared with 2009.

On the supply side, the EIA raised its forecast for OPEC crude oil production next year to 29.19 million bpd from its prior estimate of 28.89 million bpd.

"Oil inventories remain high and EIA expects oil production by the Organization of Petroleum Exporting Countries to increase as well," the agency said.

The EIA also raised its projection for oil output from non-OPEC countries in 2010 to 50.26 million bpd from its previous estimate of 50.19 million bpd.

"Over the forecast period, higher output from Brazil, the United States, Azerbaijan, Kazakhstan and Canada should offset falling production in Mexico and the North Sea," the agency said. (Additional reporting by Tom Doggett in Washington; Editing by Walter Bagley)








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