OPEC chops global oil demand growth forecast

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Pumps belonging to an oil company do their work in the Inner Mongolia autonomous region. (File photo: China Daily)

The OPEC oil cartel on Wednesday lowered its forecast for growth in global oil demand this year by nearly a fifth due to the impact of the coronavirus outbreak in China.

In its monthly report on the world's oil market, OPEC said it now expects growth in global oil demand of 0.99 million barrels per day (mbd) this year, down from the 1.22 mbd forecast last month.

"The recent outbreak of the coronavirus in China necessitated a further downward revision to the country’s oil demand growth forecast compared to last month, as transportation fuels, notably aviation fuels, are expected to be impacted" in the first half of this year.

The impact on demand for transportation fuels was exacerbated by the outbreak coinciding with the Lunar New Year holidays, when many Chinese return home to celebrate with family.

OPEC said it had also revised lower its forecast for China's economic growth this year by 0.5 percentage points to 5.4 percent.

"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," it said.