“The acceleration in the use of oil for electricity production and the switch from gas to oil are stimulating demand. In this report, we have raised our estimate of global demand growth in 2022 from 380,000 bpd to 2.1 million bpd,” the agency said in its August report on the oil market, made public on Thursday.
The gains, however, mask relative weakness in other sectors as well as a slowdown in growth, which fell from 5.1 million bpd at the start of the year to less than 100,000 bpd in the fourth quarter of 2022. estimates the IEA, noting that global oil demand is expected to reach 99.7 million b/d in 2022, then 101.8 million b/d in 2023.
Global oil supply reached a post-pandemic peak of 100.5 million b/d in July following the suspension of maintenance work in the North Sea, Canada and Kazakhstan.
Elsewhere, the increase in oil supply, accompanied by growing concerns about the deteriorating economic outlook, pushed prices down about $30 per barrel from the peak reached in June.
The prices of natural gas and electricity, meanwhile, reached new records, prompting some countries to switch from gas to oil. The latest data confirms the increase in oil consumption in electricity generation, particularly in Europe, the Middle East and Asia, at a time when several regions are experiencing scorching heat waves.