IEA downgrades 2024 oil demand progress forecast as costs warmth up

The Worldwide Power Company on Friday downgraded its forecast for 2024 oil demand progress, citing “exceptionally weak” OECD deliveries, a largely full post-Covid-19 rebound and an increasing electrical automobile fleet.

In its newest month-to-month oil market report, the IEA mentioned it had revised down its 2024 oil demand progress forecast by round 100,000 barrels per day (bpd) to 1.2 million bpd.

The worldwide vitality watchdog mentioned that it anticipated the tempo of enlargement to decelerate even additional to 1.1 million bpd subsequent 12 months “as the post-Covid 19 rebound has run its course.”

The IEA’s report comes amid a rebound in oil costs on elevated Center East tensions, with vitality market contributors carefully monitoring the prospect of provide disruptions from the oil-producing area.

Iran, which is a member of the Group of the Petroleum Exporting International locations, has vowed to retaliate after it accused Israel of bombing its embassy within the Syrian capital of Damascus earlier this month.

The assault has ratcheted up tensions in a area already grappling with the continuing Israel-Hamas war. Israel has not claimed duty for the assault.

Worldwide benchmark Brent crude futures with June supply traded 0.8% greater at $90.45 per barrel on Friday at 9:30 a.m. in London, whereas U.S. West Texas Intermediate futures with Could supply rose practically 1% to commerce at $85.84 per barrel.

“We’re seeing the surge in [electric vehicle] sales, especially in China and also in Europe, really taking into gasoline demand, but also in the United States,” Toril Bosoni, head of oil business and markets division on the IEA, advised CNBC’s “Street Signs Europe” on Friday.

“There has been a lot of talk about sales not increasing as much as maybe was expected, but EV sales and increased fuel efficiencies in the car fleet is lowering gasoline demand, at least in advanced economies and particularly in China.”

Requested about a few of the fundamental issues relating to grease provide safety, Bosoni replied, “We are watching, obviously, the Middle East very closely. The continued tanker attacks in the Red Sea is of key concern, but also escalating tensions between Iran and Israel, and then we’re seeing tensions between Russia and Ukraine continue, with attacks on Russian refineries.”

“So, there are several tension points in the oil market today that we’re watching very closely that could have major impacts … if there would be any significant outages,” she added.