Baku, Azerbaijan, Jan. 8
By Leman Zeynalova – Trend:
Global oil demand growth is expected to stand at 1.4 million barrels per day (mb/d), Goldman Sachs Group, Inc., a leading global investment banking, securities and investment management firm, told Trend.
“We estimate oil demand to have increased by 1.5 mb/d in 2018,above consensus expectations due to likely miss-measured emerging markets (EM) destocking. We view the November data points as supportive of this view, with robust readings in China, Europe and the US implying global demand growth of 1.6 mb/d year-on-year,” said the company.
Goldman Sachs said it forecasts 2019 global oil demand growth of 1.4 mb/d, reflective of global GDP growth at 3.3 percent year-on-year, conservatively below the economists 3.5 percent forecast, with a 60,000 b/d downward revision to Chinese demand growth (offset by a similar revision to US production).
“We expect Chinese demand growth to slow to 350,000 b/d year-on-year from 475,000 b/d in 2018, with limited further downside as the political importance of growth targets leaves our economists expecting that policy will continue to ease to offset recent or future weakness,” said the company.
In the US, Goldman Sachs incorporates the recent downgrade of the economists but still expects strong growth as new ethane crackers continue to come online and with 2018 demand still surprising to the upside.
“Finally, we continue to expect EM demand outside of China to recover due to (1) Brazil, Turkey, South Africa and Russia coming out of recessions, (2) a pause in fuel power demand destruction which reached 250,000 b/d year-on-year in 2018, and (3) the supportive combination of lower oil prices, a weakening dollar and a more dovish US Fed,” said the company.
----
Follow the author on Twitter: @Lyaman_Zeyn