The US Energy Information Administration on Tuesday revised downward its global energy demand projections for this year due to the economic crisis, but forecast a slight recovery in 2010.
The EIA forecast world oil demand will drop by 810,000 barrels per day in 2009, compared with last year, down 200,000 bpd from its estimate in December. “World oil consumption continues to be revised downward in response to the global economic downturn,” the EIA said in its monthly short-term energy outlook. The EIA said it expected demand in the United States, the world’s top consumer, to fall by 390,000 bpd in 2009, compared with 2008.
The EIA’s is the first of three key petroleum demand forecasts to be released this week and provided the US agency’s first estimate for oil demand in 2010. The global economic crisis has damped global oil consumption, helping to send crude oil prices from record highs above $147 a barrel in July to below $40 a barrel currently.
Global demand should begin to rebound in 2010, the EIA predicted, rising by 880,000 bpd to 85.98 million bpd, along with a modest rebound in the economy. US oil demand should rise by 160,000 bpd to 19.28 million bpd in 2010, the EIA said. Oil traders are also awaiting revised demand forecasts from the Organization of Petroleum Exporting Countries on Thursday and by the International Energy Agency on Friday.
“I would strongly expect the IEA to revise downward the growth outlook for this year,” said Mike Wittner of Societe Generale. “I don’t know if they’re going to go all the way negative (from current projection of positive demand growth this year). They ought to. I think it’s correct there will be a global contraction this year.” Wittner also said the IEA’s outlook may be influenced by the International Monetary Fund, which said it was likely to cut its estimate for economic growth across the board, especially for China, when its January forecast is released. (Reuters)