OPEC cuts oil demand outlook for 2020 as coronavirus outbreak suffocates China

OPEC has on Wednesday dramatically cut its forecast for oil demand growth for 2020, citing China’s coronavirus outbreak as the “major factor” behind its decision.

In a closely-watched monthly report, the Middle East-dominated producer group downwardly revised its outlook for global oil demand growth to 0.99 million barrels per day (bpd) in 2020. That is down by 0.23 million bpd from the previous month’s estimate.

The amended forecast is expected to reinforce the case for OPEC and allied non-OPEC producers, including Russia, to impose additional output slashes sooner rather than later.

“The impact of the Coronavirus outbreak on China’s economy has added to the uncertainties surrounding global economic growth in 2020, and by extension global oil demand growth in 2020,” OPEC stated in the report.

“Clearly, the ongoing developments in China require continuous monitoring and assessment to gauge the implications on the oil market in 2020.”

Source: CNBC