IEA Forecasts 6% Increase in Global Oil Demand

IEA Forecasts 6% Increase in Global Oil Demand

The United States International Energy Agency, IEA, has forecasted 6% increase in global oil demand for year 2021 in its monthly oil report, indicating recovery from the pandemic level.

The United States energy agency positive outlook in oil demand is on the back of better economic forecasts and robust, prompt fiscal indicators.

Having contracted by 8.7 million barrels per day (bpd) in 2020, global oil demand is estimated to rise by 5.7 million bpd to an average of 96.7 million bpd, the IEA said in its monthly oil report.

The agency warned that the recovery remains fragile with the number of Covid-19 cases surging in some major consuming countries, especially in some European countries as covid-19 vaccines fail.

Recalled that International Money Fund (IMF) recently increase global economic growth forecast for 2021 by 6%.

IEA stated in the report that improved IMF outlook, swift vaccine rollouts in the US, and hefty stimulus packages in the country, as well as improving economic data from China, led to a better global oil demand forecast.

In 2021, the highest consumption is forecast to be in the Asia Pacific region with 35.9 million barrels per day, followed by the Americas with 30.3 million barrels and Europe with 13.9 million barrels.

Global supply rises

The IEA said global oil supply increased by 1.73 million bpd in March to 92.89 million bpd mostly with the help of Saudi Arabia’s extra cut of 1 million bpd for February, March and April.

The Organisation of Petroleum Exporting Countries (OPEC) crude oil production reached 25.05 million bpd in March, recording an increase of 210,000 bpd compared to the previous month.

Read Also: Crude Oil Prices Plunge over Demand Uncertainty

Also, Non-OPEC production also saw an increase of almost 1.51 million bpd to 62.68 million bpd.

IEA Forecasts 6% Increase in Global Oil Demand