Chinese oil demand growth continues to surpass expectations, inflaming world crude prices now close to 13-year highs, the International Energy Agency said on Friday.
In its monthly Oil Market Report the Paris-based agency revised up its estimate of incremental Chinese oil demand in the first quarter by 180,000 bpd to a record 6.14 million bpd, an 18 percent increase from the same period last year.
"China's economy just keeps rolling and there is no imminent sign that it's going to stop," said Klaus Rehaag, head of the IEA's oil market division.
"There's a question over whether the infrastructure is there to handle these high levels of demand growth but if recent history provides any lessons there should be cautious optimism that it can continue," said Rehaag.
China's breakneck economic growth, fuelling record oil imports, is the main factor behind this year's surge in world crude prices.
Benchmark US crude on Thursday closed up 99 cents at $37.13 a barrel, not far from a recent 13-year closing high on the New York Mercantile Exchange of $38.18.
Now the world's second biggest oil consumer, China competes with the United States and other major importers for a pool of available exports.
China's imports from West Africa, a key area of consumer country competition have risen sharply this year. Chinese imports rocketed to a record 3.16 million bpd in February, up 280,000 bpd from January, the IEA said.
Crude and petroleum product imports combined averaged 3.02 million bpd in the first two months of this year, compared to 2.11 million bpd on average for all of 2003 and 1.61 million bpd in 2002.
North American oil demand is also rising strongly, led by gains in motor fuels. Consumption is expected to rise 300,000 bpd this year to 24.94 million bpd, the IEA said.
With Opec having just decided to implement tighter supply restrictions, consumer countries are increasingly reliant on non-Opec exports, particularly from growth areas like West Africa and Russia.
But the IEA said it had revised down its projection for non-Opec production growth this year by 185,000 bpd to just under 1.3 million bpd.
At the same time the agency, adviser on energy to 26 industrialised nations, raised its forecast for 2004 world demand growth by 60,000 barrels a day to 1.68 million bpd on the 80.3 million bpd world market.
It was the fifth successive monthly increase in the IEA's world oil demand forecast. The projection for 2004 has risen from 1.08 million bpd since the IEA's report in November.
Comments
Comments are closed.