Oil demand decreases by 9.8m barrel per day due to pandemic

Demand for oil has fallen by 9.8 million barrel per day in 2020 due to the coronavirus pandemic, but it is expected to recover by 6.5 million in 2021, OPEC Secretary General Mohamed Barkindo said on Monday, reported EFE-EPA.

Barkindo set out the forecast during a virtual conference at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC).

The average annual demand for oil stands at around 90.2 million barrel per day, nearly 10 percent less than last year’s 100.1 million, the secretary general of Organization of the Petroleum Exporting Countries added.

During the toughest moments of the international coronavirus lockdown, the demand fell to 75 million barrel per day.

Russian Deputy Minister of Energy Pavel Sorokin said at the conference that it would take two to three years for the demand to reach pre-pandemic levels.

Easing the tension between the United States and China could boost demand, UAE Minister of Energy Suhail Al Mazaroui said.

Saudi Minister of Energy Abdul-Aziz bin Salman said that the deal struck by OPEC+ members in April to stabilize the oil prices could be extended to 2022.

He expressed his country’s readiness to modify the output cuts stipulated in the deal — that ended a pricing war between the kingdom and Russia — provided there is consensus among the members.

The deal reduced the production by nearly 9.7 million barrel per day during an initial phase that concluded on 31 July. The next phases eases the cut to 7.7 million until the end of the year.

Although the participants in this event, representatives of some of the main oil-producing countries, reaffirmed their commitment to improve the efficiency of their products and reduce carbon emissions, they do not anticipate a decrease in demand for crude oil in the short or medium term.

The CEO of the state-run Abu Dhabi National Oil Company (ADNOC), Ahmed Al Jaber, said: “We expect that oil demand will grow to over 105 million barrels per day by 2030, and continue to supply over half the world’s energy needs for many decades to come."