'The market is heading into a period of heightened uncertainty with low stocks and limited spare production and shipping capacity,' the agency said. The report estimates that Saudi Arabia has capacity to produce 9.5 million b/d. This compares with production of about 9 million b/d at present.

The IEA forecast that Saudi Arabia will raise capacity to 9.7 million b/d in April and 10 million bpd in May. It estimates that the kingdom's full capacity is 10.5 million b/d.

An OPEC ministerial meeting in Vienna on 11 March agreed to leave quotas for the 10 complying members unchanged despite the recent surge in oil prices which has lifted the average OPEC basket price to more than $33 a barrel from the target of $22-28 a barrel.