14 April 2009 | Jake Kanter
Demand for oil is set to fall to levels last seen in the 1980s, according to predictions by the International Energy Agency (IEA).
The energy policy adviser said in its Oil Market Report that demand would fall this year to 83.4 million barrels a day, down 2.4 million compared to the same time last year.
The report, released last Friday, argued the speed of the contraction was similar to that in the early 1980s and demand would not recover until 2010, amid difficult economic conditions.
The fall in demand is expected to affect prices.
The Opec crude oil basket price reached an average of $41.54 (£27.94) in January, $41.41 (£27.85) in February and $45.78 (£30.79) last month. Today's basket price is $51.92 (£34.92).
The IEA said crude oil prices were "bullish", exceeding $50 (£33.6) a barrel for the first time in four months. But it believed weak market conditions would hold back any further price gains.
The report echoed similar comments made earlier this month.
Opec secretary-general Abdalla Salem El-Badri said at the International Oil Summit in Paris that the economic crisis had impacted demand "significantly".
He predicted that demand would fall by one million barrels a day this year, reflecting the "continued deterioration of the world economy and contracting international trade".