PARIS, 12 March 2004 — The International Energy Agency raised its estimate yesterday of growth in world oil demand this year by 220,000 barrels per day to 1.65 million barrels owing to strong demand in Asia and notably China.
The IEA, which has highlighted high demand for energy in China in its recent monthly reports, increased its forecast for Chinese growth in demand by 230,000 barrels per day to 580,000 barrels per day, continuing an upgrading which began in October.
Growth in China was fueling growth in neighboring countries and driving up demand for oil in the whole region, the IEA said in its monthly report.
The agency in its March report also had sharp words for oil producers which it said professed a commitment to keeping the market well supplied but were inclined to act otherwise.
“Producers seem intent on supplying the market in such a way as to maintain tight stocks,” the report said, citing a decision by the 11 members of the Organization of Petroleum Exporting Countries (OPEC) to pare back output by about four percent to 23.5 million barrels a day as of April 1.
The IEA said such a move “keeps the market on edge in the face of global demand growth” and in light of perceived political tension in suppliers Venezuela and Nigeria.
Oil prices have hovered around $30 a barrel for months and are seen as a drag on economic recovery efforts in industrialized countries. A barrel of benchmark crude was selling for more than $36 in New York yesterday.
Qatari Oil Minister Abdullah ibn Hamad Al-Attiyah said Tuesday that OPEC would press ahead with a production cut of one million barrels a day in April despite the soaring prices.