LONDON: OPEC lowered the expected demand for its crude oil in 2014 and ended a run of upward revisions to global consumption growth, highlighting concerns over the economy and pressure on its market share from rival producers.
In a monthly report on Thursday, the Organization of the Petroleum Exporting Countries forecast demand for its crude oil in 2014 would average 29.65 million barrels per day (bpd), down 50,000 bpd from the previous estimate.
The report points to a slightly more challenging year for OPEC due to slowing economies and rising supplies outside the group, such as from the shale energy boom in the US.
OPEC, which pumps more than a third of the world’s oil, still expects world economic growth to be faster this year than in 2013, but it trimmed its projected expansion by 0.1 percentage points to 3.4 percent.
The cutback was “due to a continued deceleration in the emerging economies and some softening in Japan,” said the report issued by OPEC’s headquarters in Vienna. Russia’s economy had the largest downward revision.
OPEC said the impact of the Crimea crisis was “sensitive” for energy markets and had helped to support oil prices, although it had not led to any immediate supply losses.
The group left its projection for growth in global oil demand this year unchanged at 1.14 million bpd. In reports it issued in February and March, OPEC had nudged the forecast up.
While demand was unchanged, OPEC expects higher supply from the US and countries outside the group. Non-OPEC supply overall in 2014 is expected to be 60,000 bpd higher than previously thought.
The report showed OPEC’s crude oil output in March fell close to this year’s lowered global requirement, largely as a result of supply outages rather than voluntary cutbacks.
According to secondary sources cited by the report, output fell by 626,000 bpd to 29.61 million bpd due to a drop in Iraqi exports, maintenance in Angola, unrest in Libya and a cutback by Saudi Arabia.
Saudi Arabia pumped less because of lower crude demand from customers carrying out refinery maintenance, an industry source familiar with the matter said on Tuesday.
OPEC’s view on global demand contrasts with that of the US government’s Energy Information Administration, which on Tuesday raised its 2014 world oil demand growth forecast by 10,000 bpd to 1.23 million bpd.