Global oil demand projected at 99.7 million bpd in 2022

Global oil demand in 2022 is expected to be 99.7 million barrels per day (mb/d), up 2.1 mb/d from 2021, according to the latest report from the International Oil Agency. energy (IEA).

The IEA said in its monthly market report in March that this was due to rising commodity prices and international sanctions imposed on Russia, which are expected to significantly slow global economic growth.

“As a result, we have revised down our forecast for global oil demand by 1.3 mb/d from Q2 (2Q22) to 4Q22, resulting in 950,000 barrels per day (kb/d), representing slower growth for 2022 on average,” it says.

Global refinery throughput estimates for 2022 have been revised down by 860 kb/d since last month’s report, according to the report, as a 1.1 mb/d reduction in Russian cycles is not expected to be fully offset. by increases elsewhere.

He said: “In 2022, global refinery supply is expected to increase by 2.9 mb/d year-on-year to 80.8 mb/d. Despite a downward revision in demand, product markets remain tight and further declines in inventories are expected throughout the year. »

In light of this, the IEA said Russia’s invasion of Ukraine has pushed energy security to the top of political agendas, even as commodity prices reach new heights. While it is too early to predict how events will unfold, the crisis could lead to long-term changes in energy markets.

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“The implications of a potential loss of Russian oil exports to world markets cannot be underestimated. Russia is the world’s largest oil exporter, shipping 8mb/d of crude and refined petroleum products to customers of the whole world.

“The unprecedented sanctions imposed on Russia to date largely exclude energy trade, but major oil companies, trading houses, shipping companies and banks have backed out of doing business with the country” , did he declare.

For now, the IEA estimates that a 3mb/d cut in Russian oil supply could begin in April, but losses could increase if restrictions or public condemnation become harsher.

The prospect of large-scale disruptions to Russian oil production, according to the report, threatens to create a global oil supply shock.

He said: “We estimate that from April 3mb/d of Russian oil production could be blocked as sanctions kick in and buyers shun exports.

“The Organization of the Petroleum Exporting Countries and its Alliances (OPEC+) is sticking to its agreement to increase supply by modest monthly amounts for now.

“Only Saudi Arabia and the United Arab Emirates have substantial spare capacity that could immediately help offset a Russian shortfall,” the IEA explained.

Steve R. Hansen