Oil demand in wealthy countries has not improved much and the patchy state of global recovery could prompt OPEC to keep output steady at its next meeting, the International Energy Agency (IEA) has said.
High distillate stocks in the Organisation for Economic Cooperation and Development, the group of 30 rich nations, underscored the sluggish rebound in those economies, since diesel is a key indicator of industrial activity, IEA executive director Nobuo Tanaka said. “We are concerned that economic recovery expectations are very high. While that is true in China and India, in OECD countries like Europe and Japan, we have not seen much of an actual recovery in oil demand,” Tanaka told Reuters on the sidelines of an energy conference in the city-state.
As a result, the high oil and fuel stockpiles could stay OPEC’s hand, he added. “OECD inventories are very high, and OPEC’s concern is the global economic recovery, so if the economies recover in a robust manner, they will have to produce more. If not, just simply adding to the stock levels does not make any sense.”
The Organization of the Petroleum Exporting Countries will meet in Luanda, Angola on Dec. 22 to decide on its production policy, with most members saying so far that it was too early to decide on any changes, as stockpiles remain high, though prices have risen close to $80 a barrel. The producer group has kept official production targets unchanged at meetings this year, after it agreed to curb output by 4.2 million barrels per day (bpd) last year.
 Source: Arabianbusiness.com
