The Organization of Petroleum Exporting Countries kept its forecast for 2012 oil demand unchanged, while warning that Europe’s debt crisis, world consumption harmful. The use of oil will increase by 1.1 million barrels per day, or 1.2 percent, to 88.9 million a day this year, OPEC said in its monthly report today. The 69-page document has no reference to the Iranian threat to shipping traffic by blocking the Persian Gulf. OPEC production rose to its highest level since October 2008, the report of the Vienna-based secretariat showed.
As Europe’s turmoil “would exacerbate the effect of the oil can be seen, not only through a further decline in demand for oil in Europe, but also with spillover effects on oil demand in emerging economies,” said OPEC.
European leaders will this week attempt to under-fire attempts to provide new tax rules and cut Greek debt as they urge investors Standard & Poor’s downgrades ignore Euro-area rescue. Brent crude oil futures traded at $ 111 a barrel in London today, have gained about 3 percent this year.
OPEC, supplier of about 40 percent of the oil in the world will need to produce 30.1 million barrels per day to global crude demand and supply in 2012, estimates in the report showed. That is up to 60,000 barrels per day from its forecast last month. The group that a formal output target for the 12 members of 30 million barrels per day on December 14.
Above Output Ceiling
The group pumped 822,000 barrels of crude oil per day more than the agreed output ceiling last month as Libya, Iraq and the United Arab Emirates increased production, the report said. Daily delivery of the organization increased to 30.82 million barrels per day in December from 30.65 million in November.
Iranian President Mohammad Reza Rahimi Vice said on December 27, the Persian Gulf state could close the Strait of Hormuz in response to a possible embargo against his country’s oil exports. European foreign ministers will on Jan. 23 to consider blocking the purchase of Iranian crude oil as part of sanctions against the country’s nuclear program.
Nearly 17 million barrels per day, or about one fifth of all oil traded globally transits the waterway linking the Persian Gulf with the Gulf of Oman and the Arabian Sea, according to the U.S. Energy Department.
OPEC has its forecast for production outside the organization in 2012 to 53.1 million barrels per day. This represents an annual increase of about 700,000 barrels per day driven by Brazil, the USA, Canada, Colombia and the countries of the former Soviet Union.
OPEC members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates and Venezuela.
source:bloomberg
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