IEA concerned about rapid oil price rise: Tanaka

By Muriel Boselli and Michel Rose

PARIS (Reuters) - The International Energy Agency is concerned about the rapid rise in oil prices, its executive director Nobuo Tanaka said on Wednesday, highlighting risks that a sharp increase could hurt the economic recovery.

Crude oil futures surged to a 2009 high above $75 a barrel, on Wednesday, boosted by optimism about a global economic rebound.

"The rapid hike of the price is certainly a concern," Tanaka told a news conference on the sidelines of the IEA's biennial ministerial meeting in Paris, without giving a reason for the organisation's concern.

"We have increased our predictions for demand... but data from the field is not that promising. We are watching carefully how the real economy is moving in OECD countries as well as emerging countries," he added.

The IEA, which advises 28 industrialised economies, said last week in a monthly report that it had increased its global oil demand growth estimate for 2010 to 1.42 million barrels per day, up 150,000 bpd from its previous projection.

Oil producer group OPEC also raised on Tuesday its forecasts for world demand, saying it now expected it to average 28.39 million bpd next year, up 300,000 bpd from its previous forecast.

Tanaka also said the economic crisis was an opportunity to reach an agreement at the Copenhagen summit on climate change in December, but added he was still unsure about the outcome of the summit.

"Usually, the real outcome in negotiations comes out at the last minute, so we don't know. We feel this economic crisis provides a window of opportunity to move towards a successful conclusion in Copenhagen," he said.

"Luckily, the slowdown of economic activity created a drop in CO2 emissions which is the first time since World War II... So we are cautiously optimistic (for the summit's outcome)."

Negotiators from developed countries and emerging nations have been wrestling with whether to extend the Kyoto Protocol into a second commitment period from 2013, amend the pact, or create a new one, a step many developing states resist.

Kyoto obliges rich countries to make quantified commitments to cut emissions of greenhouse gases that are stoking global warming, while developing countries do not have to assume quantified emissions targets.

China, as both the world's biggest developing country and the world's biggest emitter of greenhouse gases from human activity, is at the heart of those disagreements.

Tanaka also said nuclear power was part of the solution in the world's fight against climate change.