BAKU, Azerbaijan, March 11
By Leman Zeynalova – Trend:
Demand for OPEC crude in 2020 is forecast at 28.2 million barrels per day (mb/d), around 1.7 mb/d lower than in 2019, Trend reports citing the cartel’s Monthly Oil Market Report (MOMR) for March.
“When compared with the same quarters in 2019, demand for OPEC crude in 1Q20 and 2Q20 is expected to be 3.3 mb/d and 2.5 mb/d lower, respectively. 3Q20 shows a decline of 1.4 mb/d, while 4Q20 is expected to rise by 0.2 mb/d compared with 4Q19,” reads the report.
World oil demand growth in 2020 was revised by OPEC lower by 0.92 mb/d to 0.06 mb/d.
“The impact of the Covid-19 outbreak in China and its downward impact on transportation and industrial fuels in China was the major cause of this revision. Additionally, the outbreak is assumed to affect oil demand growth in various other countries and regions, such as Japan, South Korea, OECD Europe and some Middle Eastern countries, as well as in the US,” said OPEC.
The downward adjustment of global economic outlook was also considered in the current oil demand projection for 2020, according to the cartel.
“Total global oil demand is now assumed at 99.73 mb/d in 2020 with higher consumption expected in 2H20 than in 1H20. In the OECD, oil demand was revised lower by 0.32 mb/d mainly due the effect of Covid-19 on various countries in OECD Europe and OECD Asia Pacific. Most of that downward revision is concentrated in 1H20. Additionally, a warmer-than-expected winter in the Northern Hemisphere has capped heating fuel requirements,” reads the report.
In non-OECD, the 2020 oil demand projection was adjusted sharply lower, mainly in China and Other Asia, amid the outbreak of Covid-19 and its subsequent impact on transportation and industrial fuels, said OPEC.
“Other countries in Other Asia, such as Singapore, Thailand, Malaysia and the Philippines, have been revised lower reflecting the limitation in industrial and transportation fuels. Non-OECD oil demand was revised lower by 0.60 mb/d in 2020 with most of the downward revisions appearing in 1H20. Considering the latest developments, downward risks currently outweigh any positive indicators and suggest further likely downward revisions in oil demand growth, should the current status persist.”
---
Follow the author on Twitter:@Lyaman_Zeyn