* Sees potential for further upward revisions to demand
* Cites improving economies in Europe, United States
* OPEC pumps more crude in January on partial Libya recovery
* IEA report due on Thursday
(Adds further details from para 3, market reaction, quote)
By Alex Lawler
LONDON, Feb 12 World oil demand will rise
slightly more than expected in 2014, OPEC said on Wednesday,
becoming the second major forecaster this week to predict higher
fuel use as economic growth picks up in Europe and the United
The Organization of the Petroleum Exporting Countries, in a
monthly report, said global demand will rise by 1.09 million
barrels per day (bpd) this year, up about 40,000 bpd from its
previous forecast. The group, which pumps a third of the world's
oil, also sees potential for further rises.
"Given the improvement in OECD oil demand, the likelihood
for upward adjustments for world oil demand growth in 2014 is
currently higher than existing projections," said the report by
economists at OPEC's Vienna headquarters.
OPEC's report comes a day after the U.S. government's Energy
Information Administration raised its 2014 world oil demand
growth forecast by a similar increment. Oil prices edged
higher after it was released, with Brent crude trading
near $109 a barrel.
While the bulk of the growth in global oil demand continues
to come from China and the Middle East, OPEC was more upbeat
about the prospects for further fuel use this year in
OPEC sees a contraction in European demand - in the doldrums
for years due to recession - easing in 2014, and said
preliminary figures for December 2013 and January 2014 indicated
strong demand in top consumer the United States.
"The potential of the forecast for OECD oil demand leans to
the upside as the improving economic conditions in the U.S. and
Europe may turn out better than expected," OPEC said.
"For the non-OECD countries, risks are skewed to the
downside due to fiscal and monetary issues."
According to secondary sources cited by the report, OPEC
raised its own output to 29.71 million bpd in January, as a
partial recovery in Libyan shipments - disrupted for months by
unrest - was offset by cutbacks in top exporter Saudi Arabia.
But the stronger global demand outlook is not translating
yet into higher demand for OPEC oil, as rising supplies
including of U.S. shale oil are eroding its market share in
OPEC raised its estimate of the amount of crude non-member
countries are expected to produce this year to 54.14 million
bpd, up about 50,000 bpd from the previous estimate.
As a result, OPEC expects demand for the crude pumped by its
12 members to average 29.60 million bd, virtually unchanged and
suggesting inventories will build up should the group keep
pumping at January's rate.
Another closely watched oil demand forecast is due on
Thursday from the International Energy Agency, adviser to
(Reporting by Alex Lawler; editing by William Hardy)