Global oil demand will rise by 1.2% in 2012 to 88.96 million barrels a day, led by increases in China and other developing nations, U.S. government forecasters said Tuesday.
But the growth is about 260,000 barrels a day less than projected a month ago, after tweaks in 2011 demand in the major industrialized nations and slightly slower growth in China and other developing countries, according to the Energy Information Administration.
In 2013, demand will rise by 1.5%, or 1.37 million barrels a day, to 90.33 million barrels a day. This level, too, is off about 0.5%, or 410,000 barrels a day, from the February estimate, with downgrades in the major industrialized nations as well as the developing countries, led by China.
For 2012, demand in the nations comprising the Organization for Economic Cooperation and Development is expected to drop 0.5%, while non-OECD demand rises 3%. Within the non-OECD demand growth of 1.27 million barrels a day, China accounts for 440,000 barrels a day, and shows a 4.5% rise from a year ago, to 10.27 million barrels a day. Last month, China was forecast to show 5.4% growth, to 10.36 million barrels a day.
In 2013, OECD demand is expected to rise by 0.4%, but that’s less than the 0.6% growth projected a month ago.
Non-OECD demand in 2013 is seen rising by 2.7%, or 1.18 million barrels a day. China’s demand is expected to rise 4.6%, or 470,000 barrels a day, to 10.74 million barrels a day.
Still, the 2013 non-OECD growth is down from last month’s estimate of a 3.5% rise, while China’s demand is less than the 560,000 barrels a day, or 6.3% gain, to 10.92 million barrels a day projected last month.
In the current quarter, China’s demand is seen up 4% on the year, while second-quarter demand growth is expected to rise 4.6%.
The EIA said oil inventories held by OECD nations at the end of 2011 provided the highest level of demand cover since 1994, at 56.9 days of cover. At the end of 2013, the level of OECD stock cover is expected to be down to 55.4 days, the EIA said.
Countries outside of the Organization of Petroleum Exporting Countries are expected to boost output by 690,000 barrels a day this year, and a further 750,000 barrels a day in 2013, falling short of the expected rises in global oil demand.
The EIA said it expects OPEC oil output will “continue to rise over the next two years to accommodate the projected increase in world oil demand.” The EIA expects rises of 490,000 barrels a day in OPEC output this year and 560,000 barrels a day in 2013.
The forecast “does not factor in any potential effects that the impending European Union embargo and other sanctions may have on Iran’s crude oil production because it is too early to assess the country’s ability to place its supply elsewhere.”
The EIA said Iran’s oil output is estimated to have dropped since mid-2011 and will continue to decline through 2013.
The EIA warned of “significant uncertainties” that could push prices higher or lower, including supply disruptions or slowing growth in non-OECD countries and the failure of economic growth to be rekindled in the OECD nations.
U.S. refiners will pay a record price above $115 a barrel for imported crude this year, and a record of about $114.50 a barrel on average for combined imported and domestic oil. Those prices are up about 12% from a year ago.
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