As the price of a barrel of oil falls below US$75, Opec is predicting a sharp drop in demand next year. The supplier of more than 40 per cent of the world's oil unveiled its latest gloomy oil market forecast amid continued global economic turmoil, and as its 13 members prepare for an emergency meeting in Vienna set for Nov 18. "Dramatically worsening conditions in financial markets indicate strong fallout on the real economy is now inevitable," Opec said in its latest monthly oil market report today. "Ongoing financial market turmoil is expected to continue to impact oil demand well into the coming year."
Following a similar revision last month, the group dropped its forecast for average global oil consumption next year by 0.5 per cent - or 450,000 barrels per day (bpd) - to 87.21 million bpd. It also cut its projection for oil demand this year by 330,000 bpd. "Total world oil demand growth for 2008 has been reduced to half of the initial forecast," Opec said. It predicted demand for Opec crude would average 31.1 million bpd next year, 870,000 bpd lower than this year.
tcarlisle@thenational.ae
