by Natalie Grover and Alex Lawler
LONDON (Reuters) – The International Energy Agency (IEA) said on Friday oil demand growth next year would be weaker than projected in an earlier forecast, citing sluggish macroeconomic conditions, the the loss of activity recovery that followed COVID-19, and the growing use of electric vehicles.
Demand is expected to grow by 1 million barrels per day (mbpd) in 2024, according to the IEA’s August report, up from 1.15 mbpd previously discussed.
“The global economic outlook remains clouded by soaring interest rates and tighter bank credit, which are weighing on businesses already struggling with slowing production and trade,” the agency said.
On the other hand, demand is expected to increase by 2.2 mbpd in 2023, supported by air transport, the increased use of oil for power generation and the boom in Chinese petrochemical activity. This forecast is largely unchanged from the IEA’s previous estimate.
Demand is expected to reach 102.2 million bpd this year, with China accounting for more than 70% of demand growth, despite worries about the economy of the world’s biggest oil importer.
Demand hit a record 103 million bpd in June and could peak again in August, the agency added.
(Report Natalie Grover, Alex Lawler, Corentin Chapron, edited by Jean-Stéphane Brosse)
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