The International Energy Agency Wednesday continued to inch lower on its forecasts for global oil demand while increasing its expectations of supply growth for this year.

Since January, the Paris-based energy watchdog has cut 200,000 barrels a day from its forecast for oil demand in 2013 and added 200,000 barrels a day to its expectations of supply growth from countries outside the Organization of Petroleum Exporting Countries, or OPEC.

"The subdued growth rate of oil demand now looks increasingly entrenched in the face of high oil prices and weak economic growth," the IEA said.

In its closely watched monthly report on the oil market, the Paris-based agency, which represents the interests of major energy-consuming rich countries, estimated oil demand will grow by just 820,000 barrels a day this year to 90.6 million barrels a day, while supply from non-OPEC countries will increase by 1.1 million barrels a day to 54.5 million barrels a day.

A shale oil boom in the U.S. has contributed to a steep increase in non-OPEC supply and the IEA also said there are prospects that some 200,000 barrels a day of oil could return to the market by the end of the year if South Sudan resumes exports.

The IEA said its forecasts are more pessimistic than many other market watchers. The U.S. Energy Information Administration pegs demand growth at just over 1 million barrels a day.

The IEA said it remained cautious on oil demand growth due to a string of recent negative economic developments, including the U.S. sequester, worsening Chinese business sentiment and continued deterioration in European employment.

However, the energy watchdog also highlighted risks that continue to face the market following the death of Venezuela 's President Hugo Chavez earlier this month, raising questions about the future of the country's oil industry that has long suffered from under-investment and ageing infrastructure.

"This is hardly a recipe for clear, stable and predictable oil policies let alone supplies," the IEA said, adding that "the biggest challenges may still lie ahead."

This uncertainty occurs amid ongoing instability in many oil-producing countries.

Supply from Libya is expected to fall this month after clashes between local militias forced the shutdown of several fields, while high incidences of oil theft on a pipeline in Nigeria are also expected to dent exports from West Africa 's largest oil producer in March.

Διαβάστε ακόμα