IEA raises world oil demand

February 11, 2010
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, PARIS, Feb 11 – The International Energy Agency raised on Thursday its forecast for world oil demand this year because of growth in emerging markets, saying developed economies could face an "oil-less recovery."

The Paris-based agency said demand was now expected to be 86.5 million barrels per day (mbd) compared to a forecast last month of 86.3 mbd.

The organisation also raised its average price estimate by four dollars to 75 dollars per barrel in 2010 from some 58 dollars per barrel in 2009.

Demand growth is expected to come "entirely" from outside the Organisation for Economic Cooperation and Development (OECD), a grouping of 30 developed economies including Britain, France, Germany, Japan and the United States.

"Even the recent record US and European winter snows look unlikely to revive OECD demand — which remains flat at best in 2010 — an \’oil-less\’ recovery indeed," the IEA said in a monthly oil market report.

The IEA said this was partly due to slow growth in European and North American markets but also because of a move away from oil to gas, renewable energies and nuclear power for heating, power and industrial processes.

"The one area that drove OECD oil demand growth in recent years — North America– has virtually stalled as a result of the sharp economic recession, cheaper energy alternatives… and behavioural changes," it said.

In its January report, the IEA had revised down its 2010 world oil demand forecast because of "sluggish" trade in developed economies.

The revisions in its February report were in line with higher economic growth forecasts from the International Monetary Fund, it said.

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