The world oil demand in 2020 will fall even further than previously expected, the decline will amount to 9 million barrels per day (bpd), but could be mitigated if the economic recovery happens faster than anticipated, OPEC said in a monthly report on Wednesday
MOSCOW (Pakistan Point News / Sputnik - 13th May, 2020) The world oil demand in 2020 will fall even further than previously expected, the decline will amount to 9 million barrels per day (bpd), but could be mitigated if the economic recovery happens faster than anticipated, OPEC said in a monthly report on Wednesday.
Last month, OPEC forecast the global oil demand in 2020 to decline by a record amount of around 6.8 million barrels per day as a consequence of the COVID-19 outbreak.
"In 2020, world oil demand growth is adjusted lower by 2.23 mb/d and is now forecast to drop by 9.07 mb/d. However, the worst contraction in major oil demand centers around the world is expected to take place in the 2Q20, mostly in OECD Americas and Europe, with transportation and industrial fuels affected the most," the report read.
However, if the lockdown measures are lifted sooner than expected, while the economic recovery would be faster, the decline in oil demand might be lower than 9 million bpd, according to the cartel.
"Indeed, demand contraction in 2020 can be mitigated with sooner than expected easing of government COVID-19 related measures, and faster response of economic growth to the implemented extraordinary stimulus packages," OPEC noted.
Oil demand has dropped significantly earlier in the year due to the outbreak of the COVID-19 pandemic, which has dramatically reduced air traffic worldwide, shut production and switched employees to working from home, driving demand for jet fuel and gasoline downward.
As the falling demand caused the oil prices to plummet, the OPEC+ countries, as well as oil producers from a wider G20 group of nations such as the US, Brazil and Canada, reached what many have called a historic agreement on April 12 in an effort to stabilize the market.
The deal envisages a reduction in oil production by the OPEC+ group by 9.7 million barrels per day for two months starting on May 1, and possibly up to 15 million bpd with the G20 nations taken into account.
