IEA sees world oil use in 2010 highest since 2007

LONDON, Friday

Global oil demand this year will reach the highest level since 2007, with rising consumption led by faster growth in emerging economies in Asia, the International Energy Agency said on Friday.

The Paris-based adviser to 28 industrialised economies trimmed by 20,000 barrels per day (bpd) its expectations for the rise in global oil demand this year.

It now sees demand increasing by 1.4 million barrels per day in 2010.

Outright demand will be 86.3 million bpd, still lower than the 86.5 million bpd used in 2007, but 10,000 bpd higher than previously forecast.

Consumption has fallen for the last two years.

“Oil demand in China and Asia has been revised higher by 70,000 bpd from last month, which has more than offset a revision of 60,000 bpd in the OECD,” said David Fyfe head of the oil industry and markets division of the IEA.

“By 2011, we’re expecting something like another 1 million bpd of growth but it hinges on the economic recovery.”

Fyfe said the cold winter hitting many members of the Organisation for Economic Cooperation and Development was likely to have a limited impact on oil demand.

Crude oil prices surged to 15-month highs close to $84 a barrel in early January, with cold winter weather in much of the northern hemisphere raising expectations of higher oil demand.

“The cold wave that hit the northern hemisphere in the past few weeks has led many observers to predict a surge in oil demand driven by heating and power generation needs, and an erosion of OECD distillate stocks,” the IEA said. (Reuters)