IEA: Oil Crunch around the corner

In its starkest warning yet on the world’s fuel outlook, the International Energy Agency said the world is facing an oil supply "crunch" within five years that will force up prices to record levels and increase the west’s dependence on oil cartel Opec. "oil looks extremely tight in five years time” and there are “prospects of even tighter natural gas markets at the turn of the decade," said the agency's Medium-Term Oil Market Report, which is published every six months. "Low OPEC spare capacity and slow non-OPEC production growth are of significant concern.'' Global oil demand is forecast to expand by 2.2 percent a year on average, reaching 95.8 million barrels a day by 2012. The fastest growth will occur in Asia. The report also showed that Chinese oil demand will reach almost 10 million barrels a day in 2012, compared with its domestic production that year of about 3.9 million barrels a day.

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