The International Energy Agency says in its November report that the global demand for oil would have reduced by 90,000 barrels per day at the end of the year.
Although the volume is insignificant, the demand for petroleum has not dropped since 2009 – the climax of the global economic crisis, IEA figures said.
The energy institute reiterated its forecast of a million barrel per day reduction in the call for crude oil produced by countries in the Organisation of the Petroleum Exporting Countries which Nigeria is a member of.
“For 2019 as a whole, crude demand is likely to decline for the firsttime since 2009, albeit by only 90 kb/d. This partly explains the relative weakness of crude prices for most of 2019,” the report said.
For the third quarter of 2019 however, global oil demand surged by 1.1m barrels daily.
The IEA observed a decline in refining activities within the third quarter of 2019 as well. It said the volume of crude oil used by refiners and for direct burn in power generation declined by 300 kb/d through 3Q19.
The agency blamed the drop in the volume of crude burned by refineries on the ‘cyclical nature of refining that overproduces in some years and then slows down to clear product stock overhang.
On the supply side, the IEA said there was a 1.5 million increase in the volume of crude oil supplied to the market, thanks to Saudi Arabia. Countries outside OPEC and its Russian alliance — Canada, Norway, and the USA, also contributed to the increase in supply as well.
This is a reflection of the agency’s projection that demand for OPEC’s oil would reduce in 2020, while those outside the cartel will opt theirs to about 2.3m daily.
It said a new country – Guyana will join the burst and boom oil market.
The sole bright piece of news from a Nigerian angle in the oil market report for November 2019, is the easing off of the trade feud between the US and China, which caused the price of a barrel of Brent to rise by $2 to $62 on an average in October.