OPEC warned that the global oil demand growth would not perform well in the first half of 2013 due to economic weakness

Brent crude increased by 31 cents to $108.32 a barrel, while US crude for January rose by 43 cents to $86.22, reported Reuters.

The drop in the OPEC’s output comes in the wake of a cut in Saudi Arabian output, bringing it close to the output target of 30 million barrels a day (bpd).

Oil markets were influenced by OPEC’s warning on Tuesday that the overbearing economic weakness would dampen global oil demand growth in the first half of 2013.

A report from the US International Energy Agency (IEA), said that the crude production in the world’s top oil consuming nation is expected to reach a 20-year high in 2013, putting some pressure on oil prices.

The shale oil revolution in the United States will play a key role in an expected crude production surge in the country in 2013, which is expected to mark the fastest rate of growth in US history, decreasing the country’s need for imports.

American Petroleum Institute’s data released on Tuesday for the previous week indicated there is a growing trend for crude and refined product stocks.

Gains were also capped to some extent, as investors continued to keep their fingers crossed over the fiscal cliff deal, which is still to be addressed by US lawmakers.

Investors are now expecting that the US Federal Reserve policy meeting scheduled for today will announce several bond buying measures to support riskier assets.


Image: OPEC warned that global oil demand growth would not perform well in the first half of 2013 due to economic problems. Photo courtesy of Priwo.