Mar 13, 2020 - Energy & Environment

Coronavirus could drive down global oil consumption in 2020

Illustration of oil drum unraveling

Illustration: Aïda Amer/Axios

A number of forecasts show global oil consumption dropping this year for the first time since the financial crisis over a decade ago as the coronavirus outbreak prevents travel and stymies other economic activity.

What they're saying: The firm Rystad Energy, in a note yesterday, says it now projects global oil demand to fall by 600,000 barrels per day year-over-year — the world uses roughly 99 million barrels of oil per day — compared to 2019 levels.

  • The firm sees jet fuel demand dropping 11% this year and road fuel demand staying flat instead of growing.
  • Goldman Sachs analysts, in a note last night, now see global oil demand falling 310,000 barrels per day in 2020 compared to last year.

S&P Global Platts Analytics has a "base case" that still sees demand growth this year but also modeled a "global epidemic" scenario that shows a reduction of 975,000 barrels a day compared to last year.

The International Energy Agency estimated a drop of 90,000 barrels per day, but in their "pessimistic" case it swells to 730,000.

The bottom line: While it has long been apparent that the outbreak has thrown oil demand into reverse for the early part of 2020, analysts increasingly see the outbreak as deep and long-lasting enough to argue that oil consumption will also fall across the whole year.

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