Recovery at risk as oil demand to hit all-time high
DEMAND for oil will hit an all-time high this year, the International Energy Agency has forecast. It also warned that higher global consumption, fuelled by a near-20pc leap in demand in China, could choke economic recovery in Europe.
The agency estimated that oil demand worldwide would hit 86.6 million barrels a day this year -- 2pc higher than last year and an increase of 1.67 million barrels a day.
Demand is expected to exceed slightly the 86.5 million barrels a day consumed in 2007.
The agency said: "A recovery in oil demand is moving apace. The return of economic growth and hence oil demand growth is fuelling the increase."
However, it warned that higher prices, allied with still-tight credit conditions, "could stall OECD economic recovery".
On the activity of refineries, the agency said: "While China, India and Russia all posted record highs in February, European throughputs fell to their lowest level in 17 years."
That raised doubts over "the sustainability of Europe's petrochemical-led, manufacturing-based, export-oriented economic recovery", it said.
Peter Hitchens, oils analyst for Panmure Gordon, said: "While Opec has cut production by 200,000 barrels a day to 28.8 million this year, production in non-Opec provinces, such as Canada, Russia and the North Sea, has been stimulated by high prices and they are reckoned to have increased production by 220,000 barrels per day." (© The Times, London)