Annual oil demand growth to double in 2020
BAKU, Azerbaijan, Dec.4
By Leman Zeynalova – Trend:
Oil demand is expected to recover in 2020, according to Ann-Louise Hittle, Vice President Macro Oils, Wood Mackenzie.
“This year has disappointed because of a series of one-off factors and the slowing global economy. The 0.6 million b/d outcome will be well down on the 1.1 million b/d we forecast back in January 2019. Sanctions-related demand destruction in Venezuela and Iran, plus warm weather in Europe shouldn’t feature next year. We think annual growth will double in 2020 to 1.4 million b/d. China will be key – we expect growth there to double to 0.6 million b/d, buoyed by strong demand for marine gasoil, as bunker volumes move in response to the new low-sulphur IMO regulations on shipping fuels,” said the expert, Trend reports citing Wood Mackenzie.
Ann-Louise Hittle said she expects an increase of 1.8 million b/d in 2020 –assuming OPEC+ maintains its current production cuts. “What’s changing is the mix, and for the first time in years, the US L48 won’t dominate as much. US is about half the 2020 growth, with the rest coming from other non-OPEC producers including Guyana, Brazil and Norway. The giant Norwegian field, Johan Sverdrup, onstream since October, will add 0.3 million b/d in 2020.”
As for the geopolitical factors affecting the oil prices, the expert said tension in the Middle East and US global influence are risks again next year.
“US foreign policy has been emboldened by the rise of tight oil in 2019, indirectly affecting export sanctions – on Venezuela and Iran – and the attack on the giant Abqaiq facility in Saudi Arabia in September. None of the geopolitical challenges of 2019 has gone away. But we can see signs already that the US is refocusing on domestic policy in the run-up to the presidential election next November,” Ann-Louise Hittle added.
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