IEA dramatically revises the oil prediction dramatically

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In their first publication about the oil market after the outbreak of the coronavirus had begun, the IEA or the International Energy Agency has in a dramatic manner revised the demand forecast for oil predicting that the consumption is going to contract actually by a level of 435,000 barrels per day which is the first decline outright year over year after the Great Recession which was a decade ago. Earlier, the agency had expected the consumption to see an increase by a level of 800,000 bpd from one year ago.

For a complete year in 2020, IEA had cut their demand growth by a level of 365,000 barrels per day to only 825,000 bpd. This is the lowest increase every year since the year 2011, and this is slightly below the figures of growth for the year 2019 which was a down year in itself.

Coronavirus has been ravaging China, Beijing has released the data which is revised and this new infected number of cases has been higher vastly than the reports previously thereby raising the questions about the crisis’ severity.

There was a jump in the number of cases by 45 % after there was a revision of data to about 50,000 which had increased the total globally to a level of 60,000. The numbers may still be undercounted. Still the number of cases happening every day on a daily basis had peaked earlier in the month offering a hope for things getting better in the future.

Still, effects on the market of oil are very deep. China had been accounting for close to three quarters of the demand growth of oil in the previous year.

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