The Organization of Petroleum Exporting Countries warned that unease over the global economy is continuing to slow growth in world oil demand, but said it doesn't expect a world-wide economic recession.
OPEC trimmed its global oil-demand growth forecast for the fourth consecutive month in a report released Tuesday and warned that it could cut the outlook again amid anxiety over the prospects for world growth. It reduced the global demand-growth forecast for this year by 180,000 barrels of oil a day, the deepest such cut this year.
"The economic downturn is taking its toll on world oil demand," especially in developed nations," OPEC said.
OPEC estimated global oil demand still will rise by 900,000 barrels a day this year, saying its downgrade represents only a fraction of the 87.8 million barrels a day of oil the group expects to be consumed this year world-wide.
OPEC produces about 40% of world oil supply and holds vast oil and gas reserves.
Over the weekend, a senior oil executive for state-owned Saudi Arabian Oil Co. said the kingdom is unlikely to proceed with plans to raise its oil output, as expansion plans in other countries such as Iraq and Brazil should be enough to satisfy world markets.
Separately, OPEC Secretary-General Abdalla Salem el-Badri brushed off concerns about crude-oil prices, which have fallen 25% from a 52-week high hit in April.
"We are not panicking," he told reporters at a conference in London. "I don't think we will have a double-dip recession."
Oil executives at the conference said they were confident that demand will continue to expand due to growth in developing countries, supporting oil prices even if a recession does occur.
"Underlying [demand] growth is still there," which will support prices, said Christophe de Margerie, chief executive of France's Total SA.
Meanwhile, crude-oil futures prices followed U.S. stock markets to settle up 40 cents, or 0.5%, to $85.81 a barrel on the New York Mercantile Exchange. Prices fell after hours after Slovakia's Parliament rejected a plan to expand the euro-zone bailout fund.
