Mar 06 | 2020
(Global) Goldman Sachs Anticipates Contraction
Global oil demand is expected to fall in 2020, according to a growing number of market analysts, with Goldman Sachs Group the first major Wall Street bank to predict an overall contraction for the year.
If correct it would be only the fourth annual contraction in oil demand in 40 years and signify a major blow for breakbulk operators serving the industry.
“Over the last week, the situation has worsened with outbreaks now in a number of additional countries," said Damien Courvalin energy research chief at Goldman Sachs, noting that while production cuts may "help normalize oil demand and inventories later this year, they can't prevent an already started large oil inventory accumulation."
The International Energy Agency, or IEA, now forecasts that oil consumption growth for 2020 will be about one-third less than anticipated before the outbreak, equivalent to 800,000 barrels a day. This is well below the 10-year average of 1.3 million barrels a day and may fall further as the IIEA predicts the crisis may worsen.
If correct it would be only the fourth annual contraction in oil demand in 40 years and signify a major blow for breakbulk operators serving the industry.
“Over the last week, the situation has worsened with outbreaks now in a number of additional countries," said Damien Courvalin energy research chief at Goldman Sachs, noting that while production cuts may "help normalize oil demand and inventories later this year, they can't prevent an already started large oil inventory accumulation."
The International Energy Agency, or IEA, now forecasts that oil consumption growth for 2020 will be about one-third less than anticipated before the outbreak, equivalent to 800,000 barrels a day. This is well below the 10-year average of 1.3 million barrels a day and may fall further as the IIEA predicts the crisis may worsen.
