"The fundamentals, rather than political developments provide a very clear indication of why prices rose in early January and then dipped in the second half of the month."

The agency, which advises 26 industrialised nations, pegged crude loss at 450,000 barrels per day (bpd) in January.

Most of this was a result of extreme cold in Russia, cyclones in Australia and an array of problems in Iraq, rather than the high-profile impact of political unrest in Nigeria and the threat of potential supply-loss in Iran.

Oil prices spiked to $69.20 for US crude in January, only slightly below the record of $70.85 hit at the end of August last year.

They remain high at more than $62 a barrel.

Supply problems were partly offset by increased production from North and Latin America, Asia and Africa, meaning global oil supply fell to 84.6 million bpd, only 135,000 bpd lower than in December.

"As we go forward, geopolitical issues won't go away over night, but we wouldn't have got to oil at $60 plus without a lot of other factors," said Lawrence Eagles, head of the IEA's oil industry and markets division.

One factor is concern about the world's limited spare production capacity, a worry that should ease.

Effective OPEC spare capacity was running at a mere 1.4 million barrels per day, though the agency expected it to increase by 500,000 bpd by the middle of the year and by one million bpd by the end of 2006.

OPEC crude supply fell by 65,000 bpd in January to 29.2 million bpd, the IEA said.

Supply from the United Arab Emirates dropped by 80,000 bpd because of maintenance, though it should recover in February, while struggling Iraqi supplies fell 40,000 bpd to 1.5 million.

Ethnic unrest in Nigeria curbed output by 45,000 bpd.

So far any disruption from Iran remains academic, though concern of a possible interruption of supplies from the world's fourth biggest exporter is high following its referral to the UN Security Council over its nuclear ambitions.