On the 16th, the International Energy Agency (IEA) said that the epidemic will hit global economic growth and oil demand this year, but the reduction in oil-producing countries and the record increase in demand next year will help restore balance in the oil market.
Global oil demand will rebound next year
The IEA stated in its high-profile monthly oil market report that global crude oil demand will drop by 8.1 million barrels/day this year, slightly less than the forecast in the previous month’s report. The report predicts that oil demand will rebound strongly in 2021, reaching A record 5.7 million barrels per day.
In recent weeks, some global economies have lifted blockades related to the epidemic that have stimulated a recovery in crude oil demand. China’s oil demand in April almost returned to the same level as the previous year, and India’s oil demand increased in May.
The IEA stated in the report that if this recovery continues and the oil-producing countries adhere to their plans to tighten global oil supply, the global oil market will become more stable before the end of the second half of 2020.
Saudi Aramco cuts crude oil supply to Asia in July
According to people familiar with the matter, Saudi Aramco, the world’s largest oil exporter, has reduced the amount of July crude it will supply to at least five buyers in Asia.
This production cut is mainly aimed at medium and heavy grades. Although refining margins and oil demand have not yet caught up with rising crude oil valuations, supply in the Middle East has tightened and refinery demand for crude oil has improved, prompting Saudi Aramco to increase official sales prices in Asia by more than expected in July.
India plans to double oil refining capacity by 2030
On the 16th, the Ministry of Petroleum of India, Mandela Pradan, said that India plans to nearly double its refining capacity to 450-500 million tons in the next 10 years to meet the growing domestic fuel demand and export market. The construction of a new oil refinery on the West Coast of 60 million tons per year will start soon, which is critical to the capacity doubling plan.
As the world’s third largest oil consumer, 85% of India’s energy demand is dependent on imports. Its refining capacity in 2019-2020 is 249.9 million tons, exceeding the fuel demand of 213.7 million tons, but this demand may rise to 2030 335 million tons, which may rise to 472 million tons by 2040.
The Chairman of the Indian Petroleum Corporation Sanjif Singh cited a recent report of the Working Group on Improving Refining Capacity that India’s refining capacity will increase to 363 million tons in 2030, to 443 million tons in 2035, and to 2040 533 million tons.
Source: Mobei Public Account
