Updated from 5:16 a.m. EST

NEW YORK (

TheStreet

) -- Oil prices hovered around $71 a barrel following a forecast that suggests global oil demand will rise slightly faster next year than previously thought.

At 7:40 a.m. EST, crude oil for January delivery was trading up 50 cents at $71.04 in electronic trading on the New York Mercantile Exchange. It settled down 13 cents on Thursday to $70.54, after falling as low as $69.81.

Oil prices have fallen about 13% since October.

The International Energy Agency said Friday that global oil demand would rise slightly faster in 2010 than previously forecast, driven by increased economic activity in Asia and the Middle East.

The IEA, which advises oil-consuming countries, said in its monthly report that crude demand would reach 86.3 million barrels a day in 2010, up 1.7% from 2009. Last month, the IEA forecast oil demand of 86.2 million barrels a day in 2010.

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The forecast for demand in 2009 remained "virtually unchanged" at 84.9 million barrels a day, the IEA said.

While most of the increase in demand next year was seen coming from the developing world, the outlook for industrialized countries was also forecast to improve, particularly in the Pacific, the IEA said.

-- Reported by Joseph Woelfel in New York.

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