IEA revises up global oil demand growth for 2010

11. February. 2010

Global oil demand will grow by more than previously expected in 2010, the International Energy Agency (IEA) said on Thursday, with all the growth coming from emerging markets.

The industrialized world is going through an "oil-less" recovery, the IEA said, with signs demand has peaked in developed countries despite many returning to economic growth.

The Paris-based adviser to 28 industrialized economies revised upwards its demand growth estimate for 2010 by 120,000 barrels per day (bpd) to 1.6 million bpd.

The strong rebound in demand follows two years of falling consumption as the world struggled with the deepest financial crisis since the 1930s. The IEA estimated oil demand would now average 86.50 million bpd this year, just 10,000 bpd below the all-time peak seen in 2007.

"The demand growth is all coming from countries east of Suez," David Fyfe, head of the oil industry and markets division of the IEA told Reuters Insider TV.

"The emerging economies of China, India, the rest of Asia and the Middle East is where all the action is."

Fyfe said while demand for motor fuels and petrochemicals may rise slightly in industrial countries, there has been a huge shift away from using oil for power and heating generation.

The IEA sees oil demand growing more in 2010 than either the U.S. Department of Energy or the Organization of the Petroleum Exporting Countries. Both projected 2010 oil demand just above 85 million bpd earlier this week.

The IEA said its view on demand growth was linked to the International Monetary Fund's stronger outlook for the global economy, which is now seen growing 3.8 percent in 2010 from an earlier estimate of 3.1 percent.

Emerging market growth is expected to average 6.1 percent.
[Reuters]