The International Energy Agency has lowered its 2020 oil demand forecast, its latest oil market report has revealed.
Global oil demand is now expected to be 91.9 million barrels per day (MMbpd) this year, which the IEA highlights would be an 8.1MMbpd decline from 2019. The updated projection, which is the IEA’s first demand downgrade in several months, marks a 140,000 barrel per day drop compared to its July demand forecast for 2020.
The IEA noted in its latest oil market report that the new forecast reflects the “stalling of mobility” as the number of Covid-19 cases remains high and weakness in the aviation sector. Looking ahead to 2021, the IEA lowered its global demand estimate by 240,000 barrels per day to 97.1MMbpd. The organization said the drop was mainly due to aviation sector weakness.
In its August report, the IEA outlined that oil demand exceeded supply in June and added that there is an implied stock draw for the rest of the year.
“However, ongoing uncertainty around demand caused by Covid-19 and the possibility of higher output means that the oil market’s re-balancing remains delicate,” the IEA stated in its latest oil market report.
Back in July, the IEA revealed that global oil demand fell by 16.4MMbpd year on year in the second quarter of this year as lockdowns were imposed to combat the Covid-19 pandemic.
As of August 12, there have been 20.1 million confirmed cases of Covid-19 around the world, with 737,417 deaths, according to the latest information from the World Health Organization (WHO). The Americas has been the worst affected region, as of August 12, with 10.7 million confirmed cases and 393,727 deaths, WHO data shows.
The IEA provides analysis, data, policy recommendations and real-world solutions to help countries provide secure and sustainable energy for all, according to its website. The organization was created back in 1974.
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