Page last updated at 17:27 GMT, Friday, 12 March 2010

China's oil demand increase 'astonishing', says IEA

oil worker
Oil is trading at more than $82 a barrel

China's demand for oil jumped by an "astonishing" 28% in January compared with the same month a year earlier, the International Energy Agency (IEA) says.

The body added that demand for oil in 2010 would be underpinned by rising demand from emerging markets, with half of all growth coming from Asia.

But the IEA predicted demand in developed countries would fall by 0.3%.

The IEA has increased its global oil demand forecast for 2010 by 1.8% to 86.6 million barrels a day.

Oil prices were above $83 a barrel earlier today, the highest in two months, but dropped back to closer to $80 in late afternoon trading.

The IEA said the high price level was due to "heightening of geopolitical tensions affecting some producing countries", but that this had been balanced by "ample physical oil supplies".

Crude oil production by countries in the oil producers' cartel Opec rose to a 14-month high of 29.2 million barrels a day in February.

During February, Iraq pumped an extra 115,000 barrels a day.

Opec is due to meet on 17 March and the IEA expects it will maintain its current production targets.

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