The coronavirus crisis will lead to global oil demand dropping by around 8 percent this year compared to last year, the International Monetary Fund (IMF) said in a new report, as carried by Qatari daily The Penunsula.
This year, oil prices will be 41 percent lower than in 2019, the IMF said in its ‘Global imbalances and the COVID-19 crisis’ external report. The direct impact of the low oil prices on oil trade balances will vary across economies, reflecting their dependence on oil exports and imports, according to the IMF.
The fund’s estimates for this year’s global oil demand decline are in line with other forecasters such as the International Energy Agency (IEA) and OPEC.
Last month, the IEA said in its latest Oil Market Report that global oil demand was set to crash by 7.9 million barrels per day (bpd) this year, but this forecast is slightly more optimistic than last month’s expectation of an 8.1-million-bpd demand drop.
The IEA, however, noted that the recent rise in COVID-19 cases and the reinstating of partial lockdowns in some countries continue to contribute to the uncertainty surrounding the world’s global oil demand in 2020.
This year, the world is expected to consume an average of 92.1 million bpd of oil, compared to the typical demand of 100 million bpd, the IEA said.
OPEC, for its part, expects overall global oil demand to drop by 8.9 million bpd in 2020, before rising by 7 million bpd in 2021, when it will still be lower than demand in 2019.
The oil price plunge and the production cuts after the coronavirus pandemic will hit oil exporters in the Middle East and North Africa (MENA) hard, with the combined oil income for those countries expected to plummet by US$270 billion this year compared to 2019, the IMF said in its latest update on the region last month.