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IEA raises 2023 global oil demand estimates as China reopens its economy

14 April 2023 15:11 (UTC +04:00)

The International Energy Agency has raised its 2023 global oil demand estimates as top crude importer China reopens its economy after about three years of adhering to a strict zero-Covid policy, APA reports citing National News.

Global oil demand will rise by two million barrels per day to a record 101.9 million bpd this year, the Paris-based agency said on Friday.

Countries that are not members of the Organisation for Economic Co-operation and Development, buoyed by a resurgent China, will account for 90 per cent of the growth.

“While oil demand in developed nations has underwhelmed in recent months, slowed by warmer weather and sluggish industrial activity, robust gains in China and other non-OECD countries are providing a strong offset,” the agency said.

In the first quarter of this year, OECD oil demand fell 390,000 bpd annually but a solid Chinese rebound lifted global oil demand by 810,000 bpd above the levels of the previous year to 100.4 million bpd.

A much stronger increase of 2.7 million bpd is expected through to the end of the year, propelled by a continued recovery in China and international travel, according to the energy agency.

The report comes a day after Opec stuck to its 2023 growth projection for oil demand, despite lowering its forecast in North America and Europe amid a slowing global economy.

The oil producers' group said better crude demand in OECD countries, led by China, was balancing out the market.

China reopened its economy earlier this year after enforcing movement restrictions to contain the spread of the coronavirus pandemic.

Opec expects crude demand to grow by 2.3 million bpd this year to 101.89 million bpd.

However, that assessment is “subject to many uncertainties”, including the “trend and pace of economic activity” in OECD and non-OECD countries, it said.

Opec expects the non-OECD region's oil demand to grow by 2.2 million bpd this year while in OECD countries, it is projected to increase only slightly, to above 100,000 bpd annually.