IEA Raises Oil-Demand Forecast

LONDON — The International Energy Agency Thursday slightly raised its 2009 world crude-demand forecast for the first time in 10 months in response to gentle signs emerging that an uptick in economic activity is breathing some life back into oil consumption.

In its monthly oil market report, the IEA said it expects global crude demand this year to average 83.3 million barrels a day, representing an increase of 120,000 barrels a day from the agency’s May report.

The forecast is still fairly grim in the scheme of things, however. Demand this year is expected to tank 2.9%, or 2.5 million barrels a day, according to IEA estimates. Yet the revision signals that the sharp deterioration in petrol demand in past months has probably ended.

“It’s a fairly modest revision. Some first and second quarter (macroeconomic) data is looking slightly healthier than we expected but it’s still very early days,” said David Fyfe, editor of the IEA report.

WSJ