Oil prices have rallied to an 11-month high this month, helped by a Jan. 5 decision by most members of OPEC+ to hold production steady in February and a pledge by Saudi Arabia to voluntarily cut output.
The emergence of new strains of the virus, renewed lockdowns in China and logistical hurdles facing vaccine roll-outs contributed to the gloomier oil demand outlook by the IEA.
US has threatened sanctions on companies involved in the project.
The Trump administration had added China's oil giant CNOOC to a blacklist of alleged Chinese military companies in early December.
State Department report is expected to be issued later this week.
Both crude oil benchmarks are trading at the highest since February 2020, before the coronavirus outbreak in China began spreading across the world and billions of people went into lockdown.
Turkey and Greece are at odds over the extent of their continental shelves in the Mediterranean, energy rights in the region, air space and the status of some islands in the Aegean Sea.
The U.S. has become a major LNG exporter, mostly due to the ramp up of Cheniere's Sabine Pass terminal in Louisiana.
Saudi Arabia announces a breakthrough in talks.
Tough restrictions on socializing and businesses continued in California, the most populous U.S. state with about 40 million, and one of the largest driving markets in the world.