IEA: Oil Demand Drops as COVID-19 Surges

IEA: Oil Demand Drops as COVID-19 Surges

Pump jacks operate at sunset in an oil field in Midland, Texas US August 22, 2018. REUTERS/Nick Oxford/File Photo

Oil demand dropped last month as the coronavirus surged in India and elsewhere, the International Energy Agency said Wednesday.

Nevertheless, the International Energy Agency said in its latest monthly report that its outlook for a strong rebound in energy demand in the second half of the year remains unchanged as expanding vaccination programs allow the global economic recovery to power ahead.

The IEA said that global oil demand fell by 130,000 barrels per day in April from March, and remains lower than at the end of last year.

"The recovery in global oil demand remains fragile as surging Covid cases in countries such as India and Thailand offset recent more positive trends in Europe and the US," it said.

The IEA lowered slightly its forecast for overall demand growth this year, to an increase of 5.4 million barrels per day (mbd), due to the pandemic's continued grip on much of the world at the beginning of the year.

However, it still sees demand nearly recovering to pre-pandemic levels by the end of the year. It forecasts global oil demand to reach 99.6 mbd in the fourth quarter