You are here

IEA cuts oil demand forecast on Brexit impact

17203884 - 16_08_2010.jpg
The IEA said Thursday it had cut its oil demand growth forecast for 2017 because of a weaker outlook for the world economy following Britain's vote to leave the European Union.

[PARIS] The IEA said Thursday it had cut its oil demand growth forecast for 2017 because of a weaker outlook for the world economy following Britain's vote to leave the European Union.

Global oil demand growth is now expected to slow to 1.2 million barrels per day in 2017 from 1.4 mb/d this year "due to a dimmer macroeconomic outlook", the International Energy Agency said in its monthly oil market report. The IEA had previously forecast growth of 1.3 mb/d for 2017.

The IEA said it was basing its projections on the International Monetary Fund's decision in July to cut its world economic growth forecast following Britain's vote to leave the EU the previous month.

"As a result the global outlook for 2016-17 has worsened," the IEA said, saying Britain itself would suffer the most, but the EU was also likely to be hit as trade prospects and confidence weakened.

At the same time oil oversupply, which has been weighing on the oil price in recent months, will disappear in the course of the second half of this year, the IEA said.

Your feedback is important to us

Tell us what you think. Email us at btuserfeedback@sph.com.sg

"Our balances show essentially no oversupply during the second half of the year," the IEA said.

AFP

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes