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OPEC lowers 2021 world oil demand forecast amid COVID-19

OPEC lowers 2021 world oil demand forecast amid COVID-19

Mubasher: The Organization of the Petroleum Exporting Countries (OPEC) has cut its 2021 world oil demand growth forecast by 0.08 million barrels per day (bpd), when compared to September's assessment.

OPEC predicted that world oil demand will grow by 6.54 million bpd to 96.84 million bpd in 2021, according to OPEC's monthly oil market report.

Downgrading the 2021 outlook shows a lower economic growth forecast for the Organisation for Economic Co-operation and Development (OECD) and non-OECD regions.

In 2020, world oil demand is estimated to decline by 9.5 million bpd year-on-year (YoY) to register 90.3 million bpd to remain unchanged when compared to last month's forecast.

The oil prices have plunged amid a drop in demands due to the coronavirus (COVID-19) economic repercussions and restrictions on travel.

Although the oil industry has seen a recovery during the third quarter (Q3) of 2020 amid lockdown lift-off, OPEC referred that the pace of economic improvement would slow again.

"While the Q3-20 recovery in some economies was impressive, the near-term trend remains fragile, amid a variety of ongoing uncertainties, especially the near-term trajectory of COVID-19," the report reads.

Amid an increasing number of infections across the world, OPEC expected that the fourth quarter (Q4) of 2020 and 2021 will not witness a rebound in economic activities as seen in Q3-20.