Oil & Energy Markets

IEA Report Forecasts First Quarterly Oil Demand Drop in over a Decade

By Mahati K L
February 13, 2020
a minute read
Oil Barrels

The global demand for oil is forecast to drop for the first time in more than a decade this current quarter, according to the monthly oil report published by International Energy Agency (IEA) today. Oil demand is projected to drop by 435,000 barrels per day in Q1-2020 relative to the same period last year, with estimated demand growth for this year now forecast at 825,000 barrels a day against the IEA’s previous estimate of a nearly 1.2 million barrel per day increase. The lower demand forecast is being driven largely by the spread of the deadly Wuhan coronavirus, now officially known as Covid-19, which has infected nearly 60,000 people worldwide and claimed almost 1,400 lives. The IEA report stated that “from the point of view of the producers, before the Covid-19 crisis the market was expected to move towards balance in the second half of 2020 due to a combination of the production cuts implemented at the start of the year, stronger demand and a tailing off of non-OPEC supply growth. Now, the risk posed by the Covid-19 crisis has prompted the OPEC+ countries to consider an additional cut to oil production.”

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