Cairo: OPEC on Tuesday held its world oil demand
growth forecast steady for 2010, noting indications of
improvements in the global economy but voicing concerns that
oil's price rally remains on shaky ground.
The Organisation of the Petroleum Exporting Countries,
supplier of about 35 per cent of the world's crude, said the
world economy was projected to grow by 3.1 per cent, up from
the bloc's forecast of 2.9 per cent the previous month.
China and India remain the "bright spots for the year's
economic recovery," it said.
"In the coming months, oil market direction will mainly
depend on a continuation of the current relatively positive
outlook for the global economy, especially in key countries
such as the US and China," OPEC said in its January Oil Market
Report.
"Should developments turn out to be less positive than
expected, market attention will revert back to weak oil
fundamentals."
Given tenaciously high global crude inventories, which
remain well above five-year averages, oil's recent rally was
built on speculation, not just supply and demand.
"The persisting stock overhang, low seasonal demand and
start of refining maintenance point to the need for continued
caution over the coming months as market volatility is
expected to remain," it said, adding that the "combination of
both bullish economic news and the colder weather has
increased the financial sector's exposure to energy."
PTI
First Published: Tuesday, January 19, 2010, 20:57