Oil demand forecasts revised down for remainder of 2018
Baku, Azerbaijan, June 15
By Leman Zeynalova – Trend:
Oil demand forecasts have been revised down for the remainder of 2018 and for 2019, despite witnessing a stronger than expected global demand for oil in the first quarter of 2018 (98.2 million barrels per day as compared to estimated 98 million barrels per day), the US JP Morgan Bank said in its report obtained by Trend.
“We revise our global oil demand growth (excluding other demand) for 2018 down to 1.6 million barrels per day (previous estimate: 1.7 million barrels per day) and that for 2019 marginally lower at 1.1 million barrels per day. The revision in global oil demand is in line with downward revisions in GDP growth forecast for economies across Europe, Latin America and Middle East since our last update,” said the report.
JP Morgan economists estimate that the world GDP will grow at 3.3 percent in 2018 and 3.2 percent in 2019.
“We observed that the impact of oil prices on demand remains low when observed on an average year-on-year basis; however, there is definitely some impact evident when considered on a quarterly basis given the lag of two to four quarters at least, i.e., the rise in oil price above a certain threshold (around $80 per barrel seen in 2007-2018 and 2010-2011) ends up impacting demand after two to four quarters depending on products but also region,” said the report.
In terms of products demand, JP Morgan analysts believe that growth in demand for gasoline remains strong; however, the growth in middles distillates consumption is still expected to outpace gasoline demand growth in 2018 and then it reverts back to gasoline in 2019.
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