Even the oil bulls are surprised. Oil demand jumped by 2.7m barrels a day last year, the second-biggest annual increase in 30 years. And it is set to rise by a further 1.4m b/d this year. But that was according to the forecast of a month ago.

On Thursday the International Energy Agency will revise its forecast, and everything points to faster growth, giving ammunition to oil bulls to keep prices above $100 a barrel.

The IEA, the oil watchdog of the western nations, uses input from the International Monetary Fund to construct its oil demand forecast. The IMF recently revised its estimate of global economic growth, lifting 2010 growth forecasts from 4.8 per cent year-on-year to 5 per cent; and for 2011 from 4.2 per cent to 4.4 per cent. The faster-than-expected economic growth will translate into a bigger increase in oil demand.

Besides, preliminary data on oil demand growth in Europe and the US for November and December is somewhat higher than previously expected. Anecdotal evidence also suggests a very strong end of the year in emerging countries, particularly China.

Savvy oil forecasters believe that last year demand grew by about 3m b/d, matching the record of 2004, and that it will increase by an additional 1.7m b/d in 2011.

The pace is extraordinary: oil consumption in the 2010-2011 period will increase by almost 5m b/d, equal to more than half the current production of Saudi Arabia. The increases are much higher than the 1995-2007 average of 1.36m b/d per year. The Paris-based watchdog warned about the looming revision last month, saying in its monthly oil market report that the strong growth in oil demand appeared “partly related to more buoyant-than-anticipated global economic growth”.

The torrid growth explains why oil prices had moved close to $100 a barrel even before the unrest in Egypt prompted traders to add a risk premium to the price. If oil demand continues to move as fast as at the end of 2010 and the beginning of 2011, higher prices will be necessary to contain oil demand growth. Oil at $100 may be here to stay.