The International Energy Agency expects a high demand for crude oil, which may leave the market impotent until the end of the year at least.
Today, Thursday, the International Energy Agency raised its forecast for global demand for oil in 2021 and 2022, betting on the great demand for crude to replace gas and coal, after their prices became high.
“Oil prices have reached their highest levels in years, while shortages in natural gas, liquefied natural gas and coal support oil demand, which could render the market impotent until at least the end of the year,” the agency said in its monthly oil report.
High gas and coal prices are driving energy-intensive industries and electricity producers to switch to oil “so the lights stay on and the machines keep working”.
The global energy crisis as a whole may increase demand for crude by an additional 500,000 barrels per day compared to normal periods, according to the International Energy Agency, which advises developed countries on their energy policy.
In its previous report, the agency had expected that global demand for black gold would increase for 2021 by an additional 170,000 barrels per day, and for 2022 by an additional 210 thousand barrels per day.
But it raised its forecast and saw that global demand is supposed to rise by 5.5 million barrels per day in 2021 and then by 3.3 million barrels per day in 2022, bringing the demand for oil to 99.6 million barrels per day, which is slightly lower than the levels before Covid crisis.
Oil prices have risen significantly for months, fueled by the global economic recovery and the cautiousness of producing countries that are slowly increasing supply.
The price of a barrel of Brent North Sea is currently more than 80 dollars.
On Wednesday, the Organization of Petroleum Producing Countries (OPEC) lowered its estimate for the year 2021 for global oil demand, which was less sustainable than expected so far. However, she stressed that the strong expectations for the end of the year, and like the International Energy Agency, expected the possibility that oil will be increasingly used in some sectors at the expense of other sources of energy whose prices have become higher.
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