The International Energy Agency could cut its forecasts for global oil demand again if economies around the world fail to pick up speed, its executive director warned today.
IEA boss Fatih Birol said that a weaker global economy would reduce demand for oil.
His comments come a month after the Paris-based agency lowered its demand growth forecast to 1.1m barrels per day in 2019 and 1.3m in 2020. This would be the slowest pace since the financial crisis.
Further cuts “will depend on the global economy. If the global economy weakens, for which there are already some signs, we may lower oil demand expectations,” Fatih Birol told Reuters on the sidelines of the World Knowledge Forum in Seoul.
Experts have said China is the place to watch. Its economic growth hit 6.2 per cent in the second quarter of the year – a figure lower than any of the last 27 years.
The slowdown comes amid trade tensions with the United States, whose President, Donald Trump, has put clamping down on trade with China at the centre of his international economic policy.
“But at the same time, we shouldn’t forget low oil prices also (put) upward pressure on the demand,” Birol said.
The price of international standard Brent crude fell nearly one per cent to $62.17 per barrel this morning.
Its weighted average yesterday was the lowest point since an attack on Saudi refineries two weeks ago which sent prices rocketing by as much as 20 per cent.