* IEA sees worrying slow-down in economic activity
* Geopolitical tensions could provide floor to prices
* Iranian exports may start picking up after July plunge
LONDON, Aug 10 (Reuters) - Global oil demand growth will
fall next year below already very weak levels of 2012 due to a
slow-down in economic activity, the West's energy watchdog said
on Friday.
The outlook by the International Energy Agency (IEA) echoes
similarly pessimistic forecasts revealed this week by the U.S.
government and the Organization of the Petroleum Exporting
Countries (OPEC). {OPEC/M]
The IEA also said oil prices may remain elevated in the next
few months as geopolitical tensions, including a stand-off
between the West and Iran over Tehran's nuclear programme,
offset the bearish impact of the weaker global economy.
"The geopolitical dimension is likely to continue to provide
something of a floor for prices. The issue of Iran will likely
continue to weigh heavy on the market through the second half of
2012," the IEA said in its monthly report.
"Moreover, there is a risk that recent progress in restoring
output from Libya, Iraq and Nigeria could be jeopardised if
recent political and civil tensions worsen."
Oil prices have plunged below $90 a barrel in June
after Saudi Arabia stepped in to raise production to multi-year
highs at a time when Iranian exports plunged because of Western
sanctions.
Prices have recovered to above $110 a barrel in August
supported by Iranian tensions and investors' hopes for new money
printing programmes from global central banks to support the
flagging economy.
The IEA said it had revised its forecast for oil demand
growth in 2013 down by 150,000 barrels per day (bpd) to 830,000
bpd, below the growth of 870,000 bpd expected in 2012.
"The latest (Chinese) data reveals a sharp deceleration in
momentum compared to the doubledigit expansions seen at the
beginning of 2011," the IEA said.
On the supply side, global oil production stood in July 2.6
million bpd higher than a year ago, with 80 percent of the
increase deriving from OPEC.
"OPEC effective spare capacity nudged higher to 2.57 million
bpd but remains slim relative to current supplyside risks
permeating the market," the IEA said.
The agency also said imports of Iranian oil by major
consumers could start picking up from August.
It estimated that in July exports of Iranian oil had fallen
to multi-year lows of 1 million bpd from 1.74 million in June.
"There is scope for imports from Iran to recover modestly
from September onwards, albeit we retain our existing assumption
that around 1 million bpd of Iranian oil may struggle to find
buyers in the second half of 2012."
"An observed decline of 14 million barrels in Iranian
floating storage in July also suggests that some extra oil is en
route to customers for August/September delivery," the IEA
added.