The oil industry has an overwhelmingly gloomy economic outlook, expecting recession in the next year, less demand for fuel and lower oil prices, a survey of delegates to a major industry conference showed this week.

Seventy-seven percent of participants at the annual Oil & Money conference on Tuesday and Wednesday in London said the chances of another recession in the world's developed economies of the OECD were high with only 23 percent seeing them as low.
 

Sixty-five percent of delegates thought forecasts of global oil demand for next year would be downgraded further this year as economic slowdown took hold and only 33 percent thought North Sea Brent crude oil prices would end this year above $100 per barrel.

Brent crude oil futures traded around $110 per barrel on Thursday and have stayed above $100 for most of this year.

The organizers of the Oil & Money provided all 450 delegates with hand-held voting devices on their seats and asked a series of questions throughout the conference ranging from their preferences for ice-cream flavors to heavy macro-economic forecasts.

Economists and oil analysts have gradually cut projections for oil demand for this year and 2012 as the extent of the economic slowdown in the United States and Europe has become clear.

On Wednesday of this week the International Energy Agency, which advises the 28 developed economies of the Organization for Economic Cooperation and Development (OECD) on energy policy, cut its projections for oil demand to reflect slower economic growth.

Confirming the bearish outlook, 76 percent of participants said they saw the biggest risk to oil prices over the next year coming from demand, rather than supply, implying consumption was likely to fall as a result of less economic activity.

Most participants also said they thought the oil industry was more likely than not to be able to meet any demand for incremental oil supplies without major increases in energy prices over the next few years, with 57 percent of voters choosing this option.

Two thirds of delegates said they thought the Arab Spring had increased supply risks in the world oil market. A quarter of delegates thought the uprisings across the Middle East and North Africa over the last year would make no difference.

Oil executives were split on whether the Organization of the Petroleum Exporting Countries (OPEC) had been effective in stabilizing the oil market, with 42 percent seeing the cartel's efforts as "fair," 22 percent seeing them as "good" and 20 percent saying they were "poor."