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Global oil demand is forecast to grow more than expected due to a brighter US economic outlook and rising fuel needs of ships rerouted away from the Red Sea, the International Energy Agency said Thursday.

Commercial ships have been taking longer and costlier journeys around the southern tip of Africa to avoid attacks by Yemen's Huthi rebels in the Red Sea, a vital international trade route.

The IEA said world oil demand growth is now forecast to increase by 1.3 million barrels per day (bpd) this year, 110,000 bpd higher than in its previous monthly market report.

"Disruptions to international trade routes in the wake of turmoil in the Red Sea are lengthening shipping distances and leading to faster vessel speeds, increasing bunker demand," the IEA said, using a term for the fuel needs of ships.

Global demand is also driven by the "comparatively buoyant economy" of the United States where oil consumption is gaining momentum on rising petrochemical operations, the IEA added.

The annual growth in demand, however, remains sharply lower than in 2023, when it reached 2.3 million bpd, on the back of energy efficiency gains and the use of electric vehicles, the Paris-based agency said.

Total demand is forecast to reach 103.2 million bpd in 2024 compared to 101.8 million bpd last year.