The Organization of the Petroleum Exporting Countries said in its Monthly Oil Market Report that demand would drop by 1.37 million barrels per day (bpd) in 2009 to average 84.2 million bpd. Its previous forecast was for demand to fall by 1.01 million bpd.
Demand is falling fastest in the developed nations of the Organization for Economic Co-operation and Development (OECD), but the global downturn has also curbed previously rapid demand growth in developing countries like China and India.
Demand growth in countries outside the OECD has fallen by 90% year-on year, OPEC said, and is now expected to increase by just 200,000 bpd in 2009.
"Unlike last year, non-OECD oil demand growth has lost 90% of its strength this year," OPEC said in its report.
0:00/4:23'Pickens Plan is 100% OK'Oil prices spiked to almost $150 a barrel last July, partly influenced by expectations of continued strong demand growth in the developing world.
Oil prices have fallen to around $50 since then as a result of the spreading economic slowdown.
OPEC has promised to cut 4.2 million bpd, equal to about 5% of daily world demand, from its output levels since September to try to support prices.
The producer group, which pumps more than a third of the world's oil, held its output quotas steady when it last met in March, but called another meeting for May 28 to reassess the market.
"In the coming months, the market is expected to remain under pressure from uncertainties in the economic outlook, demand deterioration and the substantial overhang in supply," OPEC said.
"Vigilant monitoring is essential to assess the likely developments in the second half of the year and the impact these will have on market stability."
OPEC is complying with 83% of its pledged supply cuts, according to Reuters calculations based on OPEC data. The group said its production was at 27.9 million bpd in March, down by 145,000 bpd on the previous month.
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Inflation (CPI)
