Agency pares oil demand forecast due to impact of terror strikes

by The Associated Press

World demand for oil has been hit by the fallout from the Sept. 11 terrorist attacks in the United States, the International Energy Agency says.

“While there had already been a substantial reduction in global economic activity and a corresponding drop in oil demand before 11 September, the situation today looks even more disconcerting,” the Paris-based agency said in its monthly report, released Oct. 12.

A month ago, the IEA estimated global crude demand for 2001 would be up 510,000 barrels per day to 76.4 million barrels a day.

In its latest report, the IEA cut its product demand forecast by 400,000 barrels per day for the current year. Jet fuel accounted for the bulk of the reduction, the agency said.

The report said crude oil prices had dropped as much as $6 a barrel after initially rising after Sept. 11, “as fears of supply disruptions were eclipsed by concerns about the economy and oil demand.”