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Fri 10 Dec 2010 02:51 PM

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IEA see higher global oil demand for next 5 years

OPEC which has been restraining supplies, meets on Saturday to review supply policy

IEA see higher global oil demand for next 5 years
IEA, an adviser to 28 industrialised countries, in a monthly report lifted its 2011 oil demand growth forecast by 130,000 barrels per day (bpd) to 1.32 million bpd from its previous report(Getty Images)

World oil demand will be higher than expected next year and until 2015, the International Energy Agency (IEA) said on Friday, increasing the need for crude from the OPEC producer group.

The IEA, an adviser to 28 industrialised countries, in a monthly report lifted its 2011 oil demand growth forecast by 130,000 barrels per day (bpd) to 1.32 million bpd from its previous report.

Oil prices this week hit $90 a barrel for the first time in more than two years and the IEA said price strength most likely derived from a surge in consumption in the third quarter of 2010 when demand grew by 3.3 million bpd.

The report said: "Although economic concerns remain skewed to the downside, not least if current high prices begin to act as a drag on growth, more immediately demand could surprise to the upside."

It added: "Recent harsh northern hemisphere weather, allied to electric power rationing in China, if sustained, could push short-term demand."

The Organization of the Petroleum Exporting Countries, which has been restraining supplies since January 2009, meets on Saturday to review its supply policy. The group is not expected to change its official output targets.

The IEA raised its forecast for demand for OPEC crude next year by 100,000 bpd to 29.5 million bpd because of the higher demand outlook. The 12 member group pumped 29.24 million bpd in November, the IEA estimated.

In an update of its medium-term projections, the IEA said 2009-2015 world oil demand would grow by an average of 1.4 million bpd each year, higher than its previous forecast made in June.

While supply projections were also increased, the IEA said rising consumption would boost demand for OPEC crude to 32.35 million bpd in 2015.(Reuters)

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