The Paris-based agency said demand was now expected to be 86.5 million barrels per day in 2010 compared to a forecast last month of 86.3 million, while average prices will rise to $75 per barrel from 58 in 2009.
Demand growth is expected to come “entirely” from outside the Organization 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 agency said in its 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 behavioral changes,” it said.
By contrast, the world’s major emerging economies — particularly Asian powerhouses China and India — are expected to consume more and more oil as they return to strong growth and look to ramp up manufacturing.
Demand for oil in non-OECD countries is expected to surge by four percent, although the report warned continued trade imbalances and government fiscal deficits could undermine the global recovery and hence oil demand.
In its January report, the IEA had revised down its 2010 world oil demand forecast because of “sluggish” trade in developed economies.
February’s revised report was in line with higher economic growth forecasts from the International Monetary Fund, it said. The IMF now projects growth of 3.9 percent in 2010, following a 0.8 percent contraction in 2009, the first global downturn since World War II.
Analysts said that the IEA’s forecast should in itself help push up oil prices but noted that other agencies do not all share its confidence.
“The IEA continues to be the most optimistic among all large institutions,” noted Carsten Frisch of Commerzbank.
David Hufton of international oil brokerage PVM said that the US government Energy Information Administration (EIA) is forecasting a 1.2 mbd bump in demand in 2010, while oil group OPEC foresees little or no growth.
Nevertheless, OPEC members appear to have partially ignored their own club’s attempt to cut production quotas in order to keep pressure on prices.
“Appeals for production constraint at OPEC’s last meeting appear to have fallen on chronically deaf ears,” Hufton said, in an analyst’s note.
Oil prices have already climbed to levels close to the average the IEA expects for the whole year of 2010. In Asian trading Thursday, light sweet crude for delivery in March rose 35 cents to $74.87 a barrel.
New York’s main futures contract, light sweet crude for delivery in March, won 79 cents to $75.31 a barrel.
Brent North Sea crude for March delivery added 93 cents to $73.47 per barrel.
Trading was quiet, with many investors waiting for the US Department of Energy’s crude inventories report being released Friday for a clearer picture on demand in the world’s biggest energy consuming nation.
[arab news]
+of+Copy+of+Scan+Head+Letter3.JPG)
No comments:
Post a Comment