LONDON (Reuters) – World demand for OPEC’s oil will be stronger than expected next year as the economy picks up, the producer group said on Tuesday.

Demand for OPEC crude will average 28.39 million barrels per day (bpd) in 2010, the Organization of the Petroleum Exporting Countries said in a monthly report. That is up 300,000 bpd from the previous forecast.

“Supported by fiscal and monetary policy, the world economy is showing signs of recovery,” OPEC said in the report.

“Given weak oil market fundamentals as reflected in high global inventories and large OPEC spare capacity, there is a need for continued close monitoring of both economic conditions and developments in the oil market,” it said.

The group also raised its forecast for world oil demand growth in 2010, seeing an increase in world oil use of 700,000 bpd, up 200,000 bpd from the previous estimate.