By now, everyone is aware of the serious threat rising shale output from the United States poses to OPEC. But sluggish demand growth in response to the quadrupling of prices between 2002 and 2012 is at least as a big a challenge for the cartel. Consumption in the developed economies peaked at 50 million barrels per day (b/d) in 2005 and is still just 45 million b/d nine years later, according to the U.S. Energy Information Administration (EIA).

Developing economies consumption has risen by 12 million b/d over the same period (around 9.5 million b/d outside the Middle East). Net growth of 4.8 million b/d over nine years is slower than the Organization of Petroleum Exporting Countries (and other forecasters expected a few years ago. Oil demand in Asia is not growing quickly enough to offset stagnating consumption in the advanced economies and absorb all the extra supply from shale.

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