Economic Insights – Update
The International Energy Agency (IEA) has forecasted that global oil demand will grow by 1.1 million barrels per day by 2025.
In its latest monthly report published on Thursday, China is expected to remain the dominant driver of this demand increase, relying significantly on the country’s petrochemical sector. However, its contribution to global demand growth is anticipated to decrease to 19%, a stark contrast to the 60% share it commanded over the previous decade.
The IEA also predicts a return to a structural decline in oil demand from the Organization for Economic Cooperation and Development (OECD) countries, following a modest uptick last year.
In terms of global oil supply, January experienced a decrease of 950,000 barrels per day, settling at 102.7 million barrels per day. Nevertheless, this figure remains 1.9 million barrels per day higher than in the previous year.
Looking ahead, the IEA foresees an increase in global oil supply, projected to rise by 1.6 million barrels per day, reaching 104.5 million barrels per day by 2025.
Regarding Russian oil production, there was a slight increase in January, despite the latest round of U.S. sanctions targeting the nation’s oil and maritime sectors.
The agency highlighted that while these sanctions pose substantial risks to the Russian energy sector, new methods are emerging to navigate them in the maritime transport space, enabling the continuation of exports.
Furthermore, the IEA indicated that alternative strategies may emerge in the forthcoming weeks to sustain the volume of Russian oil exports.
Additionally, it was noted that the sanctions contributed to an increase in oil prices, with an upward spike of $8 reaching a five-month high in mid-January. However, these gains diminished by month-end due to intensifying concerns about the global economy and the potential impacts of trade wars.
For further updates, consider subscribing to our channel on Tilekram
