IEA revises upwards 2021 global oil demand outlook

The International Energy Agency (IEA) on Wednesday revised upwards its forecasts for global oil demand for this year in view of improved expectations of economic recovery, especially in the United States and China.

In its monthly report on the oil market published on Wednesday, the IEA estimates that an average of 96.7 million barrels per day will be consumed in 2021, which is 230,000 barrels per day more than it had anticipated in March.

After the historic drop of 8.7 million barrels per day in 2021, the world will absorb 5.7 million more barrels per day this year.

The agency justifies this correction by the new economic outlook presented at the beginning of the month by the International Monetary Fund (IMF), which expects global gross domestic product to increase by 6% in 2021 and 4.4% in 2022.

This, although it recognises that there are concerns about the strength of the recovery in the face of a spike in cases of COVID in Europe and in other major consumer countries such as Brazil and India, which are in a delicate epidemic situation.

Global demand for crude oil rose sharply, 1.7 million barrels per day more than in February, thanks mainly to the United States, which accounted for three quarters of this figure.

The IEA estimates that the outflow of crude oil to the market will increase even more in April, mainly from the United States and Brazil.

At the same time, the members of the Organisation of Petroleum Exporting Countries (OPEC) and its partners continue to restrict flows, although they have agreed to increase them progressively from May with an additional 2.1 million barrels per day between that month and July.

The group's cuts of about 8 million barrels per day in the first quarter have led to a reduction in the huge reserves that were built up worldwide last year when demand collapsed in the wake of the COVID crisis.

In February, OECD members' stocks fell by 55.8 million barrels per day to 2.977 billion barrels, still 94 million barrels higher than a year earlier.

The report's authors note that oil prices have come down from the peaks they reached in mid-March and point out that they could come under pressure again in the coming months amid rising consumption.

But they insist that there is no risk of supply problems given that in July OPEC and its partners, even if they have increased their contributions as announced, will have a surplus production margin of around 6 million barrels per day.