Reuters
Published: Tuesday, April 15, 2008PARIS - The world oil market is becoming more balanced, demand is falling and oil prices should soften as a result, International Energy Agency (IEA) Executive Director Nobuo Tanaka said on Thursday.
OPEC's research director also said U.S. demand was falling and other countries would also use less oil, depending on the extent of fall-out from a weaker U.S. economy.
"Demand is slowing down .... we are moving towards a more balanced market," Tanaka told Reuters on the sidelines of a conference in Paris.
Tanaka said oil prices, which hit a record of $112.21 for U.S. crude on Wednesday were too high, but he said softer demand and increasing stocks should bring down prices.
Asked whether the Organization of the Petroleum Exporting Countries (OPEC) should raise its output, the IEA head said oil inventories should rise if the group kept pumping at current levels.
"If they continue the current level of production, we will see stocks replenishing, so the current level of production will have to continue," he said.
OPEC's head of research Hasan Qabazard also said on the sidelines of the same conference that demand was falling in the world's biggest energy consumer the United States.
"There is lower gasoline demand in the States which is translating into lower crude (demand), roughly 400,000-450,000 barrels per day," he told reporters.
He said, however, that demand in China, India and the Middle East was robust.
The 13 members of OPEC, including Iraq that does not have a formal output target, were pumping a total of 32.25 million bpd, Qabazard said.
A Reuters survey had found they pumped 32.06 million bpd in March, slightly lower than in February.
OPEC ministers will attend the International Energy Forum in Rome later this month, but so far are not expected to use the occasion to hold a formal OPEC meeting to review output.
In Beijing on Thursday, Qatar's Oil Minister Abdullah bin Hamad al-Attiyah became the latest OPEC minister to say high oil prices were not related to any shortage of supply.
"OPEC can do nothing as it is not related to a shortage of supply ... We think very strongly there is no shortage of supply," he told reporters.