(Adds details on demand for OPEC crude, supply forecasts)
LONDON (AFX) - Oil cartel OPEC kept its world oil demand growth forecasts for next year unchanged and said its decision last week to cut output by 500,000 bpd as of Feb 1, 2007 will help address looming market imbalances.
The cartel said in its monthly report for November it continues to see world oil demand growing by 1.3 mln bpd next year, driven by continued strong demand from the Middle East and China.
For 2006, OPEC said it kept its demand growth forecast broadly unchanged at 1 mln bpd, although the number represents a slight 500,000 bpd downward revision from the last monthly report.
The cartel said robust global economic growth this year was not matched by growth in oil demand, while a particularly mild winter and rising oil prices also helped dampen demand.
Looking ahead to next year, it said 'risks for oil demand appear to be more weighed on the downside, given the dangers to global economic growth emanating from a visibly weakening US economy'.
It added that ample global stockpile levels are sufficient to accommodate strong first quarter demand and that its decision last week to delay further output cuts until February will help ensure sufficient crude supplies.
Moreover, the decision - which comes in addition to a 1.2 mln bpd cut that came into effect on Nov 1 - will help address looming market imbalances, said OPEC.
It added demand for its crude will fall by 600,000 bpd next year to total 28.3 mln bpd. At the same time, supply from non-OPEC countries will rise by 1.8 mln bpd to average 52.9 mln bpd next year, said OPEC.
'The above forecasts for 2007 thus point to weakening fundamentals. The strongest imbalance is expected to emerge during the second quarter of 2007,' it said.
Oil prices climbed to records above 78 usd in July and August but retreated steadily thereafter on worries over bulging energy stockpiles and slowing economic growth in the US.
Since early October, they have been trading between 58-64 usd and some analysts suspect gains made last week following news of further OPEC output cuts could be the impetus that brings prices back above 70 usd a barrel.
The cartel said its decision to cut output by 1.2 mln bpd from November has been 'widely recognised to have satisfactorily reduced the imbalance in the market and, as a result, halted the destabilising downward (price) trend'.
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