IEA trims global oil demand forecast on China weakness

IEA trims global oil demand forecast on China weakness

The International Energy Agency has lowered its global oil demand forecast because of surging coronavirus cases in China and weaker than expected demand in the US and other developed countries.

The energy watchdog now expects demand to average 99.4mn barrels a day this year, down from its previous estimate of 99.7mn b/d in March.

“The stringent lockdowns in China have led us to further revise down our estimate for oil demand in the second quarter and for the year as a whole,” the Paris-based group said in its monthly oil market report on Wednesday.

“In addition, more complete demand data for the first quarter of 2022, especially in the US, was sharply lower than preliminary estimates.”

The oil market has been extremely volatile since Russia’s invasion of Ukraine on February 24. Prices whipsawed on concerns over falling Russian supplies and huge stock releases by large energy-consuming nations, including the US.

Brent crude, the international benchmark, last month hit almost $140 a barrel in frenzied trading as the market tried to assess the impact of the war on Russia’s vast oil industry. It then pulled back as the US and other IEA member countries announced plans to release 240mn barrels from their strategic reserves over the