12 Feb 2009

Large drop in oil demand predicted

3:22 pm on 12 February 2009

The International Energy Agency said global energy demand this year would post its biggest decline since 1982 under the weight of the economic crisis.

The Paris-based agency said in its monthly report that global oil demand would fall by 980,000 barrels per day in 2009, a decline that would exceed its previous forecast for a 500,000 barrels per day contraction.

A separate report from the US Energy Information Administration showed crude inventories in the United States rose last week by 4.7 million barrels.

The report also showed gasoline inventories dropped last week by 2.6 million barrels.

The price of US crude fell $US1.61 on Wednesday to settle at $US35.94 a barrel while London Brent fell 33 cents to $US44.28.

US crude has been running at a big discount to Brent due to a supply glut at the main US storage hub in Oklahoma.