ABU DHABI: The end of huge economic stimulus packages around the globe threatens a modest recovery in global oil demand this year, an official from the International Energy Agency said on Monday. Governments have spent large to revive sick economies in the past year, and as countries emerge from recession, those packages were expected to wind down. That could crimp oil demand recovering after two years of recessionary contraction. That is something we are watching closely, said IEA Deputy Executive Director Richard Jones in an interview with Reuters on the sidelines of an energy conference. We think these are downward risks to demand. China, the world s second-largest energy consumer, rattled global markets last week when it increased bank reserve requirements, sparking concern it would further tighten monetary policy. That could in slow its energy demand. The IEA forecast oil demand to grow by 1.4 million barrels per day (bpd) in its monthly oil report last week, with total demand of 86.3 million bpd at its highest since 2007. The oil market was pretty well supplied so OPEC was unlikely to change output at its March meeting, he said. We see similar action in March as we saw in the last few meetings, which is to leave things as they are, Jones said. Qatar s oil minister said on Monday it was unlikely that OPEC would cut production at its March meeting. The producer group has kept its output targets unchanged since late 2008, when it made a record cut in supply to meet sliding demand and to halt a price crash. Higher spare capacity meant the oil market was in a more comfortable position than it was during the run up in oil prices to record levels near $150 a barrel in 2008, Jones said. Top oil exporter Saudi Arabia alone has around 4.5 million bpd of spare capacity after completing an expansion project last year to take the kingdom s capacity to 12.5 million bpd.
