Rystad Energy Expects 9.4% Drop In Global Oil Demand

Rystad Energy’s (Oslo, Norway) latest COVID-19 report that calculates the effect of the novel coronavirus on our lives and offers updated estimates for global fuel markets, including recent developments such as travel restrictions, quarantine obligations, and new government policies worldwide, has once again revised its global oil demand estimates.

Its newest forecast for oil demand now projects a decrease of 9.4% for 2020, or 9.4 MMbbld year-on-year. Its estimates show that total oil demand in 2019 was approximately 99.9 MMbbld, which is now projected to decline to 90.5 MMbbld in 2020. To put the number into context, a week earlier the consultancy projected a decrease of 6.4 MMbbld.
It expects that the biggest hit will happen in April, with oil demand estimated at 72.6 MMbbld, a decline of 27.5 MMbbld year on year, or a 27.5% drop. Demand in May is expected to fall by 19%, or 19.1 MMbbld, to 79.9 MMbbld.

Regional estimates for total oil demand in North America in 2020 is forecast to dip 2.3 MMbbld to 22.6 Mbbld, a 9.2% decline from 2019’s 24.9 MMbbld. April is forecast to experience a decline of 30%, with demand falling from 24.6 MMbbld to 17.2 MMbbld, and the decline continuing in May with a reduction of 21.5%, as demand decreases from 24.6 MMbbld to 19.3 MMbbld.

In Europe, oil demand for 2020 is now forecast to fall by 2.3 MMbbld to 12.7 MMbbld, a dip of 11.2% from 2019’s 14.3 MMbbld. April is expected to be off 33%, with demand falling from 14.5 MMbbld to 9.7 MMbbld, and May will see a decline of 25%, as demand falls from 14 MMbbld to 10.5 MMbbld.

Total oil demand in China for 2020 is anticipated to decline 1 MMbbld to 12.7 MMbbld, down 7.3% from 2019’s 13.7 MMbbld. April will see a dip of 13.8%, with demand falling from 14.5 MMbbld to 12.5 MMbbld, while an 11% decline in May will have demand falling from 14.2 MMbbld to 12.7 MMbbld.

For additional information go to https://www.rystadenergy.com/globalassets/pdfs/rystad-energy_covid-19-report_7-april_2020_final-public-version.pdf

SOURCE: The Weekly Propane Newsletter, April 16, 2020. Subscribe for all the latest posted and spot prices from all major terminals and refineries around the U.S. delivered to your inbox each week. Get a center spread of posted prices with hundreds of postings updated each week, along with market analysis, insightful commentary and much more.