NEW YORK, April 13 (UPI) — A three-day rally for crude oil prices came to an end Wednesday after OPEC said in its monthly report for April that demand was expected to falter.
The Organization of Petroleum Exporting Countries said its forecast for growth in world oil demand in 2016 was lowered by 50,000 barrels per day to 1.2 million bpd. That’s lower than the estimated growth for 2015 by more than 20 percent.
In its macroeconomic forecast, OPEC said the global economy was expected to grow from 2.9 percent last year to 3.1 percent in 2016.
“While many soft spots in the global economy remain, recent data is pointing at some improving momentum in the coming months,” the report read. “However, it is too early to consider this a trend, as many challenges remain.”
Crude oil prices increased for three straight days amid anticipation that representatives from major oil-producing countries would agree at a weekend meeting in Doha to hold output at January levels. Total crude oil production from OPEC members in January was about 0.5 percent higher than March.
Brent crude oil prices slipped 0.8 percent at the start of the trading day in New York to $44.31 per barrel. West Texas Intermediate, the U.S. benchmark price for crude oil, was down 0.9 percent by the opening bell at $41.77 per barrel.
Markets largely shrugged off a report Tuesday from the International Monetary Fund saying the world economy would grow this year at a “modest” rate of 3.2 percent, about 0.2 percent lower than its last estimate in January.
Referencing a range a downward pressure, from the leveling off in China to weakness in Latin America, OPEC said that, while forecasts come with a degree of uncertainty, negative pressure should remain on demand.
“Current negative factors seem to outweigh positive ones and possibly imply downward revisions in oil demand growth, should existing signs persist going forward,” it said.
That sentiment was reinforced Wednesday by a report from the European Union showing seasonally adjusted industrial production declined 0.8 percent in February when compared with the previous month.