Growing demand for oil is reversing sharply in July and will be slower for the rest of the year due to the spread of the Covid-19 Delta variant, the International Energy Agency announced on Thursday.
“Growth in the second half of 2021 has slowed sharply as new Covid-19 restrictions imposed in many major oil-consuming countries, particularly in Asia, appear to reduce mobility and oil use,” the IEA said in a statement. based in Paris.
For all the latest news, follow the Daily Star Google News channel.
“We now estimate that demand declined in July as the rapid spread of the Covid-19 Delta variant undermined deliveries to China, Indonesia and other parts of Asia,” it said in its monthly oil report.
The IEA raised demand last month to 120,000 barrels per day (bpd) and forecast growth to be half a million bpd lower in the second half of the year compared to its estimate last month, noting that some changes were due to data revisions.
A production deal reached by the OPEC + alliance – made up of the Organization of the Petroleum Exporting Countries and others like Russia – last month will restore market equilibrium in the near future, the IEA added.
“But the scale could turn into a surplus in 2022 if OPEC + continues to reverse its cuts and non-participating producers increase in response to higher prices,” he said.
OPEC +, which had imposed production cuts to support prices and facilitate oversupply, agreed in July to increase production by 400,000 barrels a month from August until the rest of the 5.8 million cut cut is phased out. barrels. read more
The United States on Wednesday called on OPEC + to boost oil production to meet rising gasoline prices and help the global economy recover. OPEC + is scheduled to meet on September 1st to review the situation.
Citing a United Nations report this week that said climate change was spiraling out of control, the IEA said people urgently needed to move to a carbon-neutral world. read more
“The global oil industry is struggling to find new business models for navigating the energy transition … while still meeting the ongoing demand for oil.”