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IEA Revises Down Forecast for World Oil Demand Growth in 2006

Posted on: Wednesday, 15 March 2006, 09:00 CST

IEA revises down forecast for world oil demand growth in 2006

PARIS, March 14 (Xinhua) -- The International Energy Agency (IEA) revised down on Tuesday its forecast for 2006 world crude oil demand growth from 1.78 million barrels per day (bpd) to 1.49 million bpd.

In a monthly report, the agency estimated a total oil consumption of 84.7 million bpd worldwide, with a decrease of some 300,000 bpd, mainly due to high oil prices and a decline in demand in Southeast Asia, one of the major dynamos of the world's growth.

But it said the demand for 2006 was still higher than the demand growth of 1 million bpd in 2005.

For Europe, the report said that western European countries were gradually replacing gasoline-fuelled vehicles with new cars, of which about 50 percent are diesel powered.

In North America and key industrialized nations of the Pacific, demand is likely to grow by just 20,000 bpd in the first quarter compared with the same period last year, the IEA said.

It noted especially that oil consumption could decline 20 percent this year in Indonesia.

The IEA also pointed out that airlines were making "substantial adjustments to their operations," mainly through increasing international passenger and freight traffic this year.

The agency said, "While there is reason to expect prices to soften if everything runs smoothly, the reality is that limited spare capacity and a bumpy road ahead are likely to support prices for some time."

The current oil prices are now floating at around 62 U.S. dollars a barrel in London as well as in New York.

Source: Xinhua News Agency - CEIS

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