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Demand growth for oil and gas to slow sharply

Oil&Gas Materials 8 December 2022 13:52 (UTC +04:00)
Demand growth for oil and gas to slow sharply
Laman Zeynalova
Laman Zeynalova
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BAKU, Azerbaijan, December 8. Demand growth for oil and gas will slow sharply in light of wider global economic slowdown, led by developed markets who return to the pre-Covid 19 trends of slower growth, Trend reports Dec.8. with reference to Fitch Solutions.

“Our Global Macro team expects a sharp slowdown in global growth from 3.1 percent in 2022 to 2 percent in 2023. They believe that inflation will slow in 2023 but take a while to reach central bank targets. This means that central banks will maintain a hawkish bent, with only a few economies likely to cut interest rates in 2023. The higher interest rate environment, along with higher inflation will impact economic growth lowering our expectations for energy consumption across 2023,” reads the latest report released by Fitch Solutions.

In particular, the company expects a sharp slowdown in developed markets (DM), in line with past economic downturns, registering just 0.5 percent annual growth in total fuel consumption for 2023.

“Emerging markets (EMs) will take over from DMs to drive global fuel consumption growth. Contrasted with DMs, EMs will provide the bulk of growth in fuel consumption for 2023, in line with a stronger economic performance. Multiple DMs are forecast to exhibit declines in growth that will see peak demand for fuel consumption occur next year. Notably, the US will see fuel consumption contract in 2023, although we do not forecast peak demand there as the rebound in growth we forecast for 2024 should return overall higher consumption.”

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