Rallying oil prices in January prompted a wave of speculative buying in the hope prices will continue going up, according to a monthly market report released by OPEC today.
The Organisation of Petroleum Buying Countries says its average price benchmark – known as the reference basket – rose 2.5% over the last month to settle at $109.28 per barrel.
Good economic news from the United States – which averted the fiscal cliff – triggered the rally in crude prices, along with improving confidence in the global economy.
The “large wave” of speculative buying in the oil futures market was stimulated by this “increasing optimism” about the economic outlook.
The signs of economic recovery on top of colder weather at the start of this year have moved OPEC to revise its forecast for the growth of world oil demand in 2013 up by 80 thousand barrels per day (b/d) to stand at 0.8 million b/d.
China accounts for the bulk of the growth with demand rising from other non-OECD countries, although OECD demand is still expected to contract.