IEA reveals reasons for slowdown in 2018 oil demand growth
Moscow. Global oil demand estimates in 2017 and 2018 are roughly unchanged at 97.8 million barrels per day (mb/d) and 99.1 mb/d respectively, according to the January Oil Market Report of the International Energy Agency (IEA).
“A 40,000 b/d downward revision to 2016 demand, however, pushed up the 2017 growth to 1.6 mb/d, while our growth estimate for 2018 remains unchanged at 1.3 mb/d,” said the report.
The slowdown in 2018 demand growth is mainly due to the impact of higher oil prices, changing patterns of oil use in China, recent weakness in OECD (Organization for Economic Co-Operation and Development) demand and the switch to natural gas in several non-OECD countries, according to IEA.
“For 2018, we see growth of 1.3 mb/d, a conservative number that acknowledges the current perception of healthy global economic activity, but also takes into account the fact that benchmark crude oil prices have increased by 55 percent since June and this can dampen oil demand growth to some extent,” said the report.
IEA analysts believe that steady OPEC production must be treated with caution, reports Trend.
“If OPEC countries plus their non-OPEC supporters maintain compliance then the market is likely to balance for the year as a whole with the first half in a modest surplus and the second half in a modest deficit,” said the report.