Global demand for oil revised upwards

A GLOBAL energy watchdog lifted its forecast for oil consumption yesterday but played down fears that prices will top $100 a barrel.

Global demand is expected to reach 86.9 million barrels a day this year and 88.2 million barrels a day next year, the International Energy Agency (IEA) said, revising up its previous forecast by 300,000 barrels for each year.

Oil prices broke through the $80 a barrel mark this month, and higher demand could prompt a further increase, which in turn could be passed on to the petrol pump and increase costs for businesses.

David Fyfe, editor of the IEA oil market report, tried to calm concerns and said there would be "comfortable levels of supply".

He said: "Prices in early October broke through the psychological $80 a barrel barrier.

"Choruses of '$100 a barrel by next year' are being heard once more. Our own view, however, is that markets could remain comfortably supplied until well into 2011."