The International Energy Agency has boosted its prediction for oil demand this year, meaning higher oil prices that could threaten the global recovery.
The IEA estimates global oil demand will total 8.3 million barrels this year, buoyed by oil use in the United States and China.
That represents a 120,000 barrel increase from the IEA’s previous estimate, though it would represent a drop of 2.9 percent from last year.
The IEA report helped push oil prices above $72 a barrel Thursday, meaning oil prices have jumped 61 percent so far this year.
Some say the gains are just getting started.
“In my estimate, oil prices will reach $100 a barrel next year,” economist Nouriel Roubini said at an economics conference, quoted by Bloomberg News.
“Oil prices have increased too much and too soon mainly because of high liquidity.”
Higher oil prices put the economic recovery in danger, experts say.
“Rising commodities prices are a tax on consumers just when income growth and employment is weak,” Michael Lewis, head of commodities research for Deutsche Bank, tells the Financial Times.
To be sure, the increased demand may not reflect much economic strength in the first place, the IEA says.
“These revisions do not necessarily imply the beginnings of a global economic recovery, and may only signal the bottoming out of the recession.”
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