Global 2020 oil demand to fall 2.8 mln bpd amid coronavirus, price war: Report
Oil demand for 2020 is set to fall 2.8 million barrels per day (bpd), or 2.8 percent, year-on-year, according to a new report from Rystad Energy analysts.
The revised estimate in oil demand slowdown, which was in the hundreds of thousands last week, is due to the rapid spread of coronavirus, officially known as COVID-19, and the subsequent lockdowns across Europe and declaration of a state of emergency in the United States, the report said.
Demand for oil has been seriously curtailed by the virus because of these shutdowns, as infrastructure and industry that need oil is running at a reduced rate or has altogether stopped.
The global economic cost of the coronavirus still remains to be counted. Some experts have already suggested that the global economy will likely face a recession in 2020, with the airline industry being particularly hard hit as governments continue to expand travel bans. In an unprecedented move, Trump on Thursday announced a shutdown of all travel from Europe to the US for 30 days.
Financial markets have been hammered by virus-related panic with the US S&P 500 Index ending a historic 11-year bull run. Central banks have moved to respond and calm markets, but many have continued to fall and oil futures have been nosediving, with US crude hitting a 17-year low.