Oil price down slightly on lower demand forecast

The price of oil was down slightly but remained above $95 a barrel Wednesday as experts said global demand for crude would be slightly lower than previously expected.

By early afternoon in Europe, benchmark oil for July delivery was down 7 cents to $95.31 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 39 cents to close at $95.38 per barrel on Tuesday.

The International Energy Agency cut its forecast for global crude demand in 2013 by 80,000 barrels a day. It now expects the world to consume 90.6 million barrels a day this year, 785,000 barrels a day more than in 2012.

"Relatively sluggish macroeconomic conditions are expected to keep a lid on growth in 2013," the Paris-based International Energy Agency said in its monthly report on oil markets.

The IEA expects consumption to be somewhat higher towards the end of the year. Demand is forecast to be 1.1 million barrels a day higher in the fourth quarter of 2013 compared with the same period in 2012.

The IEA said OPEC's output in May reached 30.89 million barrels a day, the highest in seven months, and significantly above the voluntary limit of 30 million barrels which the organization reaffirmed at its latest meeting on May 31.

OPEC's higher production, rising crude output in the United States, and sluggish demand have helped keep oil prices below $100 a barrel since May 2012.

Meanwhile, Brent crude, a benchmark for many international oil varieties, was up 25 cents to $103.27 a barrel on the ICE Futures exchange in London.

In other energy futures trading on the Nymex:

— Wholesale gasoline fell 0.36 cent to $2.8195 a gallon.

— Heating oil rose 2.04 cents at $2.8779 per gallon.

— Natural gas added 2.6 cents to $3.75 per 1,000 cubic feet.


Pamela Sampson in Bangkok contributed to this report.

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