Oil Prices Up Slightly Despite OPEC Demand Forecast

OPEC revised its 2009 oil demand predictions in its monthly report today, forecasting that demand would fall by 1.37 million barrels per day (bpd) this year.  The revision showed a sharper decline that the cartel’s previously predicted demand drop of 1.01 million bpd.  OPEC cited uncertain economic times, still-fading demand, and excess supply as the main factors that drove the downward revision.

Oil prices declined moderately in response to the announcement, giving back gains posted earlier in the morning and setting prices near yesterday’s closing position.  At 9:47 am EDT, the price of crude had gained 1.5 percent over yesterday’s closing price to $50.16 a barrel.  The price of heating oil had gained 0.8 percent.

HEAT USA Price Experts confirmed yesterday’s prediction of a half-cent increase in retail prices today, and predicted that the OPEC announcement would weigh down prices as the trading day wears on and bring a small decrease in retail prices tomorrow.

HEAT USA Price Report
Today’s average retail heating oil price per gallon: UP $0.005
Morning projection (for Thursday’s average price per gallon): DOWN $0.01