North America and Europe are consuming less oil, but worldwide demand is still rising despite increasing prices.
The International Energy Agency came out with its monthly report yesterday and, in some ways, it's business as usual. Demand in Western economies for oil dropped by about 190,000 barrels a day, bringing daily consumption down to 49.3 million barrels. Demand in China, India, and other developing nations, however, rose by 120,000 barrels a day to 38.3 million barrels a day.
In all, that comes to 87.5 million barrels a day of oil being consumed worldwide--close to earlier projections. Despite a dip that could be due, in part, to a weaker economy, oil consumption will likely continue to climb slowly. By the fourth quarter, it will be above 88 million barrels a day, according to the report. A year ago, oil consumption in the first quarter of 2007 was around 86 million barrels a day.
By 2030, daily demand is expected to be in the 116 million-plus barrels-a-day range, a little lower than the 2005 projection of 121 million barrels a day for 2030 but still a leap from today. Back in 1990, the world consumed 66 million barrels a day, and in 1970 only 50 million barrels a day, according to IEA statistics.
On the supply side of things, production from OPEC and West Africa dipped slightly, but the shortfall was compensated by output from Iraq, Canada, and the nations bordering the Caspian Sea.
Oil has been trading around the $109-a-barrel level, an all-time high.