Global oil consumption, which averaged 100 million barrels per day in 2019, took a hit this year because of the coronavirus pandemic, which halted manufacturing and slowed down economic activity.
Oil demand could shrink by 18.7 million barrels per day in April, compared with the estimated 10.5-billion drop in March, Goldman Sachs said in a note dated Wednesday.
The top investment bank has revised its earlier estimate of a drop of four million barrels per day from February to April.
The coronavirus pandemic has forced entire economies into lockdowns, disrupting economic activity, supply chains, and a slew of energy-dependent industries, as well as airlines.
Since the beginning of 2020, oil prices have nosedived by almost 50 percent, as decreasing oil consumption coincided with the OPEC+ breakdown and triggered a massive sell-off.
On Thursday, following three days of gains, WTI crude futures fell by 7.7 percent to $22.60 per barrel, while Brent futures slumped 3.7 percent to $26.43 per barrel. There is a strong chance that the prices will remain depressed for months, until the global economy returns to normal.
Goldman Sachs forecasts a “further sharp sell-off in oil prices” in coming weeks, but expects that prices could rebound sharper than its earlier outlook of $40 per barrel Brent by the fourth quarter of the year.
Sourse: sputniknews.com
