LONDON: World oil demand will rise much more than expected this year, the International Energy Agency (IEA) said on Thursday, in the latest sign that the collapse in oil prices is helping to boost fuel use.

The agency in its monthly report raised its forecast for global oil demand growth in 2015 by 280,000 barrels per day (bpd) to 1.40 million bpd, bringing demand this year to almost 94 million bpd.

"Recent oil market strength of course partly stems from unexpectedly strong global oil demand growth," said the IEA, which advises industrialised nations on energy policy.

Oil prices have staged a recovery this year after hitting a near six-year low close to $45 in January. Prices collapsed from $115 in June 2014 in a decline that deepened after OPEC refused to prop up prices and chose instead to defend its market share.

By 0800 GMT on Thursday, benchmark Brent crude was trading around $65.75 a barrel.

As well as resurgent demand, the IEA report also pointed to strong supply. Production by the Organization of the Petroleum Exporting Countries rose to 31.33 million bpd in May, its highest since August 2012, and is likely to remain above 31 million bpd in coming months, the IEA said.

And the IEA raised its forecast of supply growth from non-OPEC producers this year by 195,000 bpd to 1 million bpd, citing an upward revision to U.S. data and fewer summer maintenance shutdowns in other regions.

"Lower oil prices and a drop in capital spending are taking time to curb non-OPEC supply," the report said.

"Despite signs of a slowdown in non-OPEC supply, notably in the U.S., global production growth remains exceptionally high." -Reuters