LONDON--Anemic economic growth will likely continue to limit oil demand in the coming year, the International Energy Agency said.
In its monthly oil market report, the Paris-based energy watchdog kept its forecast for oil demand growth in 2013 unchanged at 0.8 million barrels a day, but warned that risks remain skewed to the downside.
"A weak economic backdrop continues to restrain oil demand growth throughout the forecast," it said.
The risks are particularly acute for the world's richest industrialized nations, the agency said, highlighting the ongoing economic problems in Europe and the looming U.S. fiscal cliff.
Slower-than-expected economic expansion has already had a severe effect on oil demand this year.
The IEA has cut estimates for global oil demand in the fourth quarter by 850,000 barrels a day since June, including a decrease of 300,000 barrels a day this month as fall-out from Hurricane Sandy in the U.S. compounded the impact of the sluggish economy on oil demand.
The superstorm wreaked havoc on the U.S. East Coast in late October, causing severe disruption to travel and product delivery.
The weak demand picture has meant that the world hasn't experienced a significant supply shortfall this year despite frequent supply losses, including strict sanctions that have had a sharp impact on Iran's oil exports and a long list of unplanned refinery outages and shutdowns in the U.S., Venezuela, Europe, Japan and the Caribbean.
"The disruptions would have hit much harder if the economy had not been far weaker than expected," the IEA said.
However, it added that "a growing reliance on international trade for product supply is spreading oil supply risk from the upstream to the downstream." As a result, consumers in all regions will be more exposed to local disruptions that could have more profound impact in a market with a tighter supply-and-demand balance.
Ample supply thanks to the growth of shale oil in the U.S., record Russian output and a surge in Saudi and Iraqi supplies this year also helped blunt the impact of disruptions.
Non-OPEC supply is set to continue to grow to 54 million barrels a day next year, driven primarily by production growth in the U.S., the IEA said.
In its World Energy Outlook published Monday, the IEA said that the boom in production in the U.S. would help the country overtake Saudi Arabia as the world's largest oil producer by 2020.
According to the IEA, supply from the Organization of Petroleum Exporting Countries fell to its lowest level in nine months in October, mainly as a result of supply disruptions in Nigeria that saw output tumble to two-and-a-half year lows. However, the group of oil producers continued to supply sufficient oil to meet its customers' demand, the agency said.
Severe flooding in the West African country--the continent's biggest oil exporter--cut production by around 500,000 barrels a day during October, while attacks on oil pipelines also dented output.
Production from Iran, on the other hand, inched higher last month, halting a seven-month downtrend.
Sanctions imposed by the European Union and the U.S. this year have hit the Islamic Republic hard, making it increasingly difficult for it to export its oil.
According to the IEA, oil supply from Iran edged higher by 70,000 barrels a day to 2.7 million barrels a day in October. Imports from Iran rose by 300,000 barrels a day, with China and South Korea appearing to take the majority of the additional oil, the IEA said.