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Global oil markets may have rallied following the latest positive results from vaccine trials, but they are unlikely to feel any significant economic benefits until early next year, the International Energy Agency.
In its monthly report, the IEA darkened its outlook for crude consumption in the coming months, citing the resurgence of Covid-19 infection rates in the United States and Europe. He now expects demand for 2020 to drop 8.8 million barrels per day this year, up 400,000 barrels per day than his last forecast. This is more severe than the reduction planned for Wednesday by OPEC.
The agency also lowered its demand forecast for the third and fourth quarters of 2020 as well as the first quarter of 2021, while estimating a supply increase of more than one million barrels per day in November. Libyan supplies are rebounding after a months-long export blockade and US production is picking up after shutdowns caused by the hurricane in October. U.S. production was down 7% from its 2019 average level last month.
After a mild start to the winter season in the Northern Hemisphere, when people start turning on their heaters, new lockdowns across Europe and rising infection rates in the United States have prompted the based organization to Paris to reduce its estimate of demand for the fourth quarter by 1.2 million. barrels per day. A vaccination against Covid-19 will not significantly affect global demand in the first half of 2021, the IEA said.
Oil prices swung between gains and losses on Thursday, after abandoning modest early gains after the report was released. Brent, the global benchmark, rose 1.4% to $ 44.42 per barrel and U.S. crude futures rose 1.6% to $ 42.12 per barrel. Both benchmarks have risen more than 12% so far this week.
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