LONDON - The International Energy Agency (IEA) is calling for more oil on the world market to circumvent economic harm to countries that import oil, the Wall Street Journal reports. The agency€™s governing board asked oil producers to up their output to "help avoid the negative global economic consequences which a further sharp market tightening could cause."
The Organization of Petroleum Exporting Countries (OPEC) counters that supplies are adequate. "We stand ready to work with producers," the agency said. OPEC has a June meeting scheduled to talk about oil production, but some members have indicated raising output levels would probably not be discussed.
For years, the IEA has pointed out what it sees as the harm high oil cost could do to the world economy. Since early May, international oil prices have dropped around 10 percent, but still are staying at high levels.
"Additional increases in prices at this stage of the economic cycle risk derailing the global economic recovery and are neither in the interest of producing nor of consuming countries," the agency said. "Oil-importing developing countries are most likely to be seriously affected by high oil prices, undermining their economic and social well-being."
Earlier this week, U.S. oil futures ended higher than $100 a barrel for the first time in a week. Many analysts already believe that high oil costs have impacted the United States. "U.S. oil demand data has taken a turn for the worse over the last couple of weeks as high gasoline prices have increasingly curbed demand," said Standard Chartered analysts.