DUBAI, (Reuters) – Next year will be a tough one for the oil market as the global economic slowdown eats into demand, Qatar’s state news agency QNA quoted the country’s oil minister as saying.
U.S. crude has fallen over $90 from its July peak over $147 a barrel as the world’s big oil consumers burn less fuel due to slowing economic activity. “I expect 2009 to be a difficult year. All the indicators affirm a large decline in demand during the last quarter of the current year and the first quarter of 2009,” QNA quoted Oil Minister Abdullah al-Attiyah as saying late on Monday.
Attiyah pointed to increasingly bleak forecasts for oil demand growth from the Paris-based International Energy Agency. The IEA cut its forecast last week for global demand growth next to 350,000 barrels per day (bpd) next year, down 340,000 bpd from its previous forecast.
He declined to say whether the Organization of the Petroleum Exporting Countries might take a decision to cut oil supply when ministers meet for informal talks in Cairo later this month.
Attiyah reiterated his concern that slowing investments in high-cost oil projects due to lower oil price could contribute to a long-term shortage in supply when demand picks up.
Qatar signed an agreement with Germany’s Wintershall, a unit of BASF, on Monday for oil and gas exploration and production, QNA said.
Wintershall would spend $100 million on exploration in the next three years, Qatar daily newspaper al-Sharq newspaper reported Qatar Petroleum’s head of oil and gas projects as saying.
Qatar is the world’s largest exporter of liquefied natural gas (LNG), which is gas chilled to liquid form for shipping on special tankers. Qatar is a small OPEC producer, with output of around 860,000 bpd.