13-11-07 The International Energy Agency said there were "clear signs" that high oil prices were hitting demand in OECD countries, slashing its estimates of consumption for the fourth quarter of 2007 and next year.
Demand in the OECD is now expected to fall for the second consecutive year in 2007 to an average of 49.23 mm bpd, down from 49.32 mm bpd in 2006 and from 49.67 mm bpd in 2005, the IEA said in its latest monthly oil market report.

"The effects of this year's price rise are seemingly already contributing to slowing down transportation fuels demand, notably in the US," the IEA report said.
"While there are clear signs that the rise in prices since the second quarter this year has pressured gasoline and diesel demand growth in the OECD, it is too soon to believe that significant structural changes have taken place," the IEA said.

For the world as a whole, the IEA cut its estimate of demand for the fourth quarter of this year by 500,000 bpd to 87.14 mm bpd, and for 2008 by 300,000 bpd to87.69 mm bpd.
World oil demand is still expected to grow by a healthy 2.3 % next year, largely due to robust economic growth outside the OECD and the fact that consumers in China and the Middle East are largely protected from high prices by subsidies, the IEA report said.

Demand in China is expected to rise 5.7 % to an average of 7.97 mm bpd next year, while demand in the Middle East is seen rising 4.4 % to 6.87 mm bpd.
Demand in the OECD is also expected to recover, and should rise by 1.2 % to reach 49.84 mm bpd.

The IEA left its estimates of non-OPEC oil supply for 2007 and 2008 largely unchanged, meaning that the downward revisions to demand had a knock-on effect on the “call” on OPEC crude.
The call on OPEC is now expected to 31 mm bpd in 2008, 300,000 bpd less than previously predicted and only 200,000 bpd above this year's expected call of 30.8 mm bpd, the IEA said.