LONDON, Nov 18: Oil prices held firm on Tuesday as the Centre for Global Energy Studies (CGES) forecast a contraction in global demand for the first time in 25 years amid a severe global economic slowdown.

Brent North Sea crude for delivery in January rose 10 cents to $52.41 a barrel on London's InterContinental Exchange (ICE). Earlier Tuesday it had fallen to $51.25.

On the New York Mercantile Exchange (NYMEX), light sweet crude for December added 33 cents to $55.28, after slumping to $54.13 -- the lowest level since January 29, 2007.

“Global oil demand is expected to contract in 2008 for the first time for a quarter of a century,” London-based CGES said in its latest monthly report published on Tuesday.

“Opec’s emergency agreement last month to cut production by 1.5 million barrels per day has so far failed to halt the price slide and will not do so until real output cuts have been implemented.”

The Organisation of Petroleum Exporting Countries (Opec), which produces 40 per cent of world oil, has so far failed to fully implement its output cut set to have begun on November 1, according to analysts.

“Oil demand forecasts continue to be revised downwards and a year-on-year contraction in global oil demand in 2008 and 2009 is now a very real possibility for the first time for 25 years,” CGES said.

“The path of oil prices will depend on how, and how quickly, Opec cuts production in response to the falling demand for its oil,” it added.—AFP