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IEA says coronavirus vaccines unlikely to rescue oil market soon

IEA says coronavirus vaccines unlikely to rescue oil market soon

Mubasher: The International Energy Agency (IEA) said on Thursday it does not expect the prospect of a coronavirus vaccine to significantly boost oil demand until well into next year, CNBC reported.

In its latest monthly report, the IEA predicted world oil demand to contract by 8.8 million barrels per day (b/d) this year, a downward revision of 0.4 million barrels from last month’s assessment.

The Paris-based energy agency trimmed its near-term outlook on weak historical data and a resurgence of COVID-19 cases in Europe and the US.

For 2021, the IEA said world oil demand growth will rise by 5.8 million b/d, representing an upward revision of 0.3 million barrels from last month.

Oil prices have notched three consecutive trading sessions of gains since Pfizer and BioNTech announced that early results showed their vaccine candidate was more than 90% effective in preventing COVID-19 infections.

Though oil markets cheered the new vaccine news, hoping it could lead to higher energy demand in the coming months, the IEA, however, said, “It is far too early to know how and when vaccines will allow normal life to resume. For now, our forecasts do not anticipate a significant impact in the first half of 2021.”