Opec expects world oil demand to grow by nearly 1.9 million barrels a day in the third quarter this year, driven higher by strong economic growth, the oil producer cartel said in its monthly oil market report on Tuesday.
The report from Opec's Vienna Secretariat said the cartel expected third quarter world oil demand to rise to 80.18 million bpd, up from 78.3 million in the second quarter.
The group saw another jump in fourth quarter demand to 82.44 million bpd, putting total world demand growth this year at 2.3 percent - the strongest in seven years, the report said.
Oil prices have risen to 21-year highs as low fuel stocks during the seasonal second quarter demand lull sharpen concern over global supplies later in the year when demand rises.
Opec said that the rise in oil prices, above $41 a barrel for US crude, did not appear to be hurting world economic growth, especially when a fall in the value of the dollar over the last year was taken into account.
"It seems unlikely that the current strong momentum of the world economy has been greatly restrained by such a limited increase in the real oil price," Opec said.
The acting Managing Director of the International Monetary Fund (IMF) Anne Krueger told Reuters on Tuesday that oil prices were not yet in the danger area for the world economy.
Ministers use the Opec Secretariat report as part of their production policy calculations. The group will meet informally later this week on the sidelines of a conference in Amsterdam. Ministers meet formally on June 3 in Beirut.
Rising fuel consumption in industrialised countries has bolstered explosive demand growth in China. Oil prices should cool if global economic growth slows as forecast towards the end of the year, the report said.
"Economic recovery is clearly well established but the consensus expects a gradual deceleration in global economic growth towards the end of this year," the report said.
"Whenever the world economic cycle does begin to turn down, this factor will have a direct effect on the oil market," it added.
Opec said it cut crude production by 264,000 bpd in April to 28.05 million bpd as producers enforced part of a deal to cut supply from April 1.
The UAE, which was performing field maintenance and top cartel producer Saudi Arabia, led the cutbacks.
"However, May nominations and tanker movements indicate much higher volumes, and Opec Member Countries are considering further production increases as part of their commitment to respond to market realities," the Opec report said.
Opec estimated the third quarter demand, or 'call', for its crude at 26.32 million bpd - a rise of 360,000 bpd from its previous estimate. The fourth quarter 'call' was estimated at 27.54 million bpd - lifted 420,000 bpd from the previous estimate.
Opec has lifted estimates for the demand on its crude oil as slower-than-expected growth in non-Opec supply tightened the strain on the cartel's crude. The report revised down its estimate of non-Opec supply growth this year by 60,000 bpd to 1.34 million bpd. The 10 Opec members with quotas, excluding Iraq, have a formal target of 23.5 million bpd but are producing around 2.1 million bpd above the target to meet strong demand.
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