The coronavirus outbreak will cut growth in global oil demand by more than half this year compared to earlier forecasts, Norway's biggest independent energy consultancy Rystad Energy predicted on March 5.
Oslo-based Rystad now predicts global oil demand will grow by 500,000 barrels per day (bbl/d) in 2020, down from a February forecast of 820,000 bbl/d and a December view of 1.1 million bbl/d.
"This is assuming that the COVID-19 epidemic will largely be contained by the end of June," Rystad Energy said in a statement.
OPEC agreed on March 5 to cut oil output by an extra 1.5 million bbl/d in the second quarter of 2020 to support prices that have been hit by the coronavirus outbreak, but made its action conditional on Russia and others joining in.
In Rystad Energy's view, this is unlikely to result in cuts in production sufficient enough to balance the market given that global oil stocks are increasing by the day.
Recommended Reading
OPEC+ Unlikely to Tweak Oil Policy in April 3 Talks
2023-03-30 - Russia-led OPEC+ is holding a virtual meeting on April 3 to discuss cutting existing oil output.
Russian Oil and Gas Budget Revenues May Fall US$700MM in May
2023-05-18 - Russia's oil and gas revenues may reach 593 billion roubles, down from 648 billion roubles in April and 886 billion roubles in May 2022.
Oil Gains After IEA Sees Demand Rising to Record High
2023-04-14 - The IEA said world oil demand is set to grow by 2 MMbbl/d in 2023 to a record 101.9 MMbbl/d, driven in most part by stronger Chinese consumption after the lifting of COVID restrictions.
OPEC+ Likely to Stick to its Guns Despite Price Slump, Delegates Say
2023-03-22 - OPEC+ plans on sticking to its deal on output cuts of 2 MMbbl/d until the end of the year, even after the banking crisis following the collapse of two U.S. lenders and Switzerland's UBS buying Credit Suisse.
US Emergency Oil Reserves Fall to Lowest Level in 40 Years
2023-04-17 - U.S. Strategic Petroleum Reserve feel by by nearly 1.6 MMbbl the week of April 10, Department of Energy data shows.