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IEA reversed its outlook on Oil demand on Virus, sees outlook for second half of 2021 cut by 550,000 barrels a day Stockpiles to rebound in 2022 if OPEC+ reverses output cuts

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The International Energy Agency cut forecasts for global oil demand “sharply” for the rest of this year as the resurgent pandemic hits major consumers, and predicted a new surplus in 2022.

"Growth for the second half of 2021 has been downgraded more sharply, as new COVID-19 restrictions imposed in several major oil consuming countries, particularly in Asia, look set to reduce mobility and oil use," the Paris-based IEA said.

"We now estimate that demand fell in July as the rapid spread of the COVID-19 Delta variant undermined deliveries in China, Indonesia and other parts of Asia." e second half than it had estimated last month, noting some changes were due to revisions in data.

It’s a big reversal for the Paris-based agency, which just a month ago was urging the OPEC+ alliance to open the taps or risk a damaging spike in prices. The oil cartel heeded calls to hike supply, which is now arriving just as consumption slackens  with the delta threats.

Forecasts from the IEA

  • The IEA put the demand slump last month at 120,000 barrels per day (bpd) and predicted growth would be half a million bpd lower
  • Global oil demand is now seen rising 5.3 mb/d on average, to 96.2 mb/d in 2021, and by further 3.2 mb/d in 2022”
  • On average, demand will not recover to pre-pandemic, but it will in Q4 2022

Source: IEA

From The TradersCommunity News Desk.

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