London: World oil demand will recover at a faster pace than previously expected next year due to a more optimistic economic outlook, the International Energy Agency said on Friday.
In a monthly report, the agency, which advises 28 industrialised economies, increased its global oil demand growth estimate for 2010 to 1.42 million barrels per day (bpd), up 150,000 bpd from its previous projection.
Next year, world oil demand is expected to average 86.05 million bpd, reflecting more optimistic economic projections from the International Monetary Fund and stronger data for the Americas and Asia.
“Demand is nudging higher,” David Fyfe, head of the IEA’s Oil Industry and Markets Division told Reuters.
“On the assumption that we are not in a double-dip situation economically speaking, we would still expect a pick-up in demand next year.”
Oil inventories in the developed OECD countries fell to the equivalent of 60.7 days of forward demand cover at the end of August, down from 61.4 days at the end of July, it said.
The Organization of the Petroleum Exporting Countries (Opec) pumped more oil in September than in August - taking compliance with promised output curbs down to 62% from 66%, the IEA said.
Opec decided to leave its official output target unchanged at a meeting in September, but lower supply from the group still has the potential to tighten the market, the IEA said.
“While Opec is presently producing well above output targets, the existing production agreement at least holds the potential to push absolute OECD inventory levels closer to seasonal norms again by second-half 2010,” it said.
Oil prices remained lower after the report was released. US crude was down 49 cents at $71.20 as of 2:00pm.