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The International Energy Agency (IEA) has raised its forecast for %OilDemand this year by 110,000 barrels per day (bpd) as conflict in the Middle East and disruptions along the Red Sea shipping corridor continue.

World oil demand will increase by 1.3 million barrels per day in 2024, according to the IEA’s latest outlook report.

The upward revisions are a reversal from previous forecasts that called for a slowdown in oil demand this year, with 2024 demand initially forecast to grow by 860,000 barrels per day.

The revised outlook from the IEA comes as crude oil prices rise above $80 U.S. per barrel. West Texas Intermediate (WTI) crude oil, the U.S. standard, is currently trading at $80.50 U.S.

Brent crude oil, the international benchmark, is trading at $84.61 U.S. a barrel.

While the IEA has lifted its outlook for oil demand, its view is still much lower than that of the oil producing cartel known as The Organization of the Petroleum Exporting Countries (%OPEC).

On March 12, OPEC announced that it was keeping its demand growth forecast unchanged at 2.25 million barrels per day.

Even with its upward revision, the IEA is behind OPEC’s current forecast by nearly one million barrels per day.

The main reason for the IEA’s upward revision is continued disruptions to global shipping due to ongoing conflicts in the Middle East.

The IEA noted that nearly 1.9 billion barrels of oil were at sea at the end of February this year, the highest level since the onset of the Covid-19 pandemic in 2020.

However, in its demand outlook summary, the IEA said that a cloudy economic outlook will weigh on oil demand later this year even as the challenges to shipping routes provide a short-term boost to prices.