OPEC sees oil around $70-$80 in coming months

LONDON (Reuters) - Oil prices are likely to trade around $70 to $80 a barrel in coming months, supported by improving economic and oil market conditions, OPEC said on Wednesday.

The monthly report from OPEC said world oil demand would rise by 900,000 barrels per day (bpd) in 2010, 20,000 bpd higher than previously forecast, but the need for crude from its members would fall from the previous year.

“Current conditions in the world economy and the very comfortable outlook for oil market fundamentals are likely to remain supportive for prices to continue to move within this range ($70-$80) over the coming months.”

OPEC’s report comes after positive comments from the International Energy Agency (IEA), adviser to industrialized economies, which said on Tuesday that world oil demand would hit a record high this year.

But OPEC trimmed the forecast for 2010 demand for its own crude by 130,000 bpd, reflecting higher non-OPEC supply.

Supply from countries outside OPEC in 2010 will rise by 500,000 bpd from the previous year, Wednesday’s report said, an increase of around 90,000 bpd from its previous forecast.

OPEC’s compliance with output targets fell to 53 percent in March, compared with 55 percent in February, according to Reuters calculations based on data from Wednesday’s report.

The group announced in December 2008 it would cut production as prices slumped to below $33 in the global economic crisis. But with oil now above $80 there is less incentive for members to comply with quotas.

Reporting by Joe Brock; editing by Alex Lawler and Sue Thomas