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Oil prices fall after Opec report | |
(about 8 hours later) | |
Oil prices have fallen after producers group Opec said it now expected demand for its crude to decline further than predicted next year. | |
Blaming the slow nature of the global economic recovery, Opec now expects demand for its crude to average 27.97 million barrels per day in 2010. | |
This is 480,000 barrels lower than its 2009 estimate and greater than the 380,000 fall it previously predicted. | |
US light crude was down 98 cents to $69.62 a barrel after the Opec report. | |
London Brent was $1 lower to $72.50. | |
'Price pressure' | |
Opec predicted global oil prices would fall further unless there was more indication that the world economy was improving. | |
The oil market continues to be defined by the tension between optimism over the perceived recovery of the global economy... and persistently weak global consumption of crude oil Energy Information Administration | |
"If market expectations for an economic recovery are not fully realised, current price levels could face increasing pressure," it said. | |
Oil prices had risen earlier on Tuesday after figures showed record crude imports by China, the world's second largest oil consumer. China's oil imports rose by 42% in July to 4.62 million barrels per day. | |
Separately, the US Energy Information Administration (EIA) cut its 2009 oil demand forecast on Tuesday. | |
It now predicts global consumption will fall by an average 1.71 million barrels per day this year, compared with its previous estimate of a 1.56 million barrel decline. | |
"The oil market continues to be defined by the tension between optimism over the perceived recovery of the global economy on the one hand and persistently weak global consumption of crude oil and other liquid fuels on the other," said the EIA. | |
Oil prices peaked at a record $147 a barrel in July last year, before falling to about $30 at the start of 2009 due to the impact of the global recession, from where they have since recovered to around $70. | |
The 12-nation Opec grouping produces more than a third of the world's oil. |