A worker holds a fuel pump nozzle at a gas station in Shah Alam, Malaysia, on Tuesday, January 12, 2021.
Samsul Said | Bloomberg | Getty Images
LONDON – The International Energy Agency on Tuesday cut its global oil demand forecast for 2021, citing high Covid-19 cases and renewing blockade measures that will further limit mobility.
The IEA said it now expects global oil demand to recover by 5.5 million barrels a day, to 96.6 million this year. This reflects a downward revision of 0.3 million barrels from last month’s assessment and an unprecedented collapse of 8.8 million barrels a day last year while the coronavirus pandemic attacked world oil markets.
The latest IEA oil market report comes as countries continue to implement strict public health measures in an attempt to curb the spread of the virus, with blockades imposed on Europe and parts of China.
The Paris-based energy agency said growth in oil demand is expected to fall slightly during the first three months of the year as a result of tougher government plans that require additional travel restrictions.
This is expected to slow global mobility once again, causing the IEA to cut its first-quarter growth forecast for oil demand to 94.1 million barrels a day. With that, oil demand would return to almost the levels of a year ago and reflects a downward revision of 0.6 million barrels according to the December oil market report.
“Global vaccine deployment lays the groundwork for a stronger trajectory for the year, with supply and demand returning to growth mode after the unprecedented collapse of 2020,” the IEA said in a statement. your monitored report.
“But it will take longer for oil demand to fully recover, as renewed closures in several countries weigh on fuel sales,” he added.
Oil prices
Oil prices have risen in recent weeks, backed by optimism over Covid vaccine deployments and a surprise reduction in APEC oil production in Saudi Arabia.
However, the relatively slow pace of inoculations has raised doubts about how quickly economies will be able to recover.
International benchmark Brent crude futures traded on Tuesday morning at $ 55.26 a barrel, up 0.9%, while West Texas Intermediate U.S. futures were at $ 52.51 a barrel. , about 0.3% more.
Both benchmarks fell more than 2.2% in the previous session, recording their worst daily performance since Dec. 21.
Oil pumping dams, also known as “assed donkeys,” at a Rosneft Oil Co. site near the village of Sokolovka in the Republic of Humurt, Russia, on Friday, November 20, 2020.
Andrey Rudakov | Bloomberg | Getty Images
OPEC and its non-OPEC allies, an alliance sometimes called OPEC +, cut oil production by a record amount in 2020 in an effort to support crude oil prices, as strict Public health measures around the world coincided with a shock to fuel demand.
OPEC + initially agreed to reduce production by 9.7 million barrels per day, before reducing cuts to 7.7 million and eventually reducing to 7.2 million from January. The de facto leader of OPEC, Saudi Arabia, has since said it plans to reduce production by an additional 1 million barrels a day in February and March to prevent inventories from being built.
Last week, OPEC kept unchanged global oil demand forecasts for 2021. The 13-member group predicted that demand growth would increase by 5.9 million barrels per year annually to reach 95.9 millions on average.