The lower expectations stem from the same reasons cited by everyone else:  uncertain global economic and financial prospects may adversely affect demand. 
All year the IEA has been expressing concerns that weaker global economies could fracture demand. Now they have put some numbers to the projections.   

Global oil demand is cut by 200,000 b/d in 2011 and by 400,000 b/d in 2012, with lower readings from the emerging non-OECD economies a key factor. It marks one of the first times that lower projections are a part of the non-OECD picture.   
IEA also trimmed its economic growth expectations to 3.9 percent in 2011 and 4.2 percent in 2012 and continued to sound the warning of “significant downside risks.” That’s down from 4.2 percent and 4.4 percent, respectively.   
Demand estimates now stand at 89.3 million b/d in 2011, which still represents a 1 million b/d increase year-over year, and 90.7 million b/d in 2012, which would reflect a growth of 1.4 million b/d.   

IEA injects scenarios that could lower demand growth projections even deeper, but says the case for the weaker numbers are not its “most likely prognosis” but admits “the financial and economic headwinds are nonetheless gaining momentum.”   

IEA picks up a cue offered earlier this week by Goldman Sachs when Goldman advanced its belief that tight oil supplies will result in higher prices by the end of the year. Goldman didn’t say but the sense you get from Goldman’s analysis is “the economy be damned,” oil prices are going higher because of tight supplies.   

OECD oil inventories rose 10.8 million barrels to 58.4 days of forward demand, IEA points out. Stocks fell below the five-year average for the first time since 2008, a statistic that does confirm Goldman’s view that market stocks didn’t really grow that much despite the release of emergency crude stocks to make up for Libya’s production.   
IEA believes that demand for OPEC crude will recede by 500,000 b/d to 1 million b/d from the fourth quarter of 2011 through the second quarter of 2012. That should help ease some of the supply tightness.   

Regarding China, IEA projects demand growth for diesel fuel to be 3.355 million b/d in 2011, up from 3.142 million b/d in 2010. It is expected to rise to 3.511 million b/d in 2012.  By 2012, China’s thirst for petroleum will top 10 million b/d for the first time ever. IEA forecasts total consumption to hit 9.596 million b/d in 2011, up from 9.069 in 2010, and rising to 10.083 million b/d in 2012.