IEA: Global oil demand will return to pre-epidemic levels by the end of next year

The International Energy Agency (IEA) stated in its monthly oil market report on June 11 that global oil demand will return to pre-epidemic levels by the end of 2022. In 2020, global oil demand has dropped by 8.6 million barrels per day as never before, and it is expected to increase by 5.4 million barrels per day this year and a further 3.1 million barrels per day in 2022.

The IEA emphasizes that the recovery of oil demand varies by region, field, and product type. Although the epidemic in developed economies is coming to an end, the slow progress of vaccination may endanger the recovery of non-OECD countries. Because travel restrictions will exist until the epidemic is strictly controlled, the aviation industry will become the slowest recovery area. In addition, due to the continued remote working mode and the increase in the number of electric vehicles, the demand for gasoline is expected to be lower than the level before the outbreak.

According to IEA data, global oil production in May increased by 960,000 barrels per day from the previous month, for a total of 94.3 million barrels per day. The output of OPEC member countries increased by 370,000 barrels per day from last month to 25.43 million barrels per day, of which a considerable part was driven by the increase in Saudi Arabia’s production. The implementation rate of the output reduction alliance in May was 114%.