Guinness sees 20% fall in oil price as demand dries up

International Energy Agency cuts 2011 forecast by 200,000 barrels and 2012 estimate by 400,000, although price not expected to collapse.

Fund managers at Guinness Asset Management have tipped the price of Brent crude to fall by as much as 20% after the IEA slashed its outlook for demand this year. The IEA last week cut its 2011 forecast by 200,000 barrels and its 2012 estimate by 400,000, leaving overall growth at 1 million barrels per day for this year, and 1.4 million barrels per day next year. OPEC also published a similar report forecasting sluggish growth over the next two years, prompting fears over weakening oil prices. Signs of this slump in demand have already been feeding through into prices. Brent crud...