OPEC on Wednesday again revised down its estimate for world crude demand, predicting that a “devasting contraction” in consumption would keep prices under pressure in the months ahead. “In the coming months, the market is expected to remain under pressure from uncertainties in the economic outlook, demand deterioration and the substantial overhang in supply,” the Organization of Petroleum Exporting Countries wrote in its latest monthly report. It said “vigilant monitoring is essential” ahead of the corganization's next meeting at the end of May at which some members are expected to push for further output cuts to help support prices. “Oil demand is suffering more and more from the world economic recession,” it said, adding that this trend had resulted in another downward revision in its forecast for demand this year of 0.4 million barrels per day (bpd). OPEC estimated that demand would contract by 1.37 million bpd or 1.6 percent in 2009. In its previous monthly bulletin released in March, OPEC had been penciling in a contraction of 1.01 million bpd for 2009. “World oil demand is already out of its high demand seasonality achieving nothing but devastating contraction,” OPEC said. World oil prices fell Wednesday on news that US crude reserves had hit the highest level since 1990, indicating fragile demand in the recession-blighted American economy. New York's main futures contract, light sweet crude for delivery in May, fell 16 cents from its closing price on Tuesday to $49.25 per barrel. London's Brent North Sea crude for May delivery lost 17 cents to settle at $51.79 per barrel. The US government's Department of Energy (DoE) said crude stocks surged 5.6 million barrels in the week ending April 10 to 366.7 million barrels, the highest level since September 1990. OPEC's next meeting is in Vienna on May 28. OPEC has cut its oil production target by an overall 4.2 million barrels per day since September to 24.84 million bpd, the lowest level since just after invasion of Iraq in 2003.
