Sign Up for FREE Daily Energy News
CDN NEWS  |   US NEWS  | TIMELY. FOCUSED. REVELANT. FREE
BREAKING NEWS:

Shocker PASS - Headwind Solutions
Sur-Flo Meters
Hazloc Heaters
Shocker PASS - Headwind Solutions
Hazloc Heaters
Sur-Flo Meters

Top Oil Trader Sees Demand Growth Slowing Amid U.S.-China Fracas


By Verity Ratcliffe and Manus Cranny

(Bloomberg) Growth in global oil demand is slowing and won’t exceed 650,000 barrels a day this year before picking up pace up in 2020, according to Vitol Group’s chief executive officer.Oil markets are focused on the U.S.-China trade war while “slightly under-pricing” the risk of possible supply disruptions arising from geopolitical tensions in the Persian Gulf, Vitol CEO Russell Hardy said in a Bloomberg TV interview in Abu Dhabi. Weak demand in established markets is spurring Vitol to focus on emerging economies, he said.“We’ve been continuously revising our expectations for growth down,” Hardy said Wednesday. The world’s biggest independent oil trader expects demand to increase by 600,000 to 650,000 barrels a day in 2019, “and we’re expecting about 800,000-barrels-a-day growth for next year. Those numbers are a little bit down from when we first set them out. They don’t include NGLs,” or natural gas liquids, he said.

The International Energy Agency expects oil consumption to grow by about 1.2 million barrels a day this year, but Wall Street has been turning more pessimistic. JPMorgan Chase & Co. sees growth of 800,000 barrels a day, which would be the lowest growth rate since 2011. If demand rises by less than 600,000 barrels a day this year, it would be the weakest since 2009, according to IEA data.

Biggest Trader

The U.S. Energy Information Administration sees oil use rising by 1 million barrels a day this year, according to a monthly outlook it issued on Tuesday.

Vitol is “a little bit concerned” about growth among industrialized nations over the next 10 to 15 years, Hardy said. “Growth in the developing nations, emerging markets is going to be more interesting for us as a trading company, so we have to shift a little bit of our focus towards that.”

China’s growth is moderating, and the trade dispute between Washington and Beijing is taking a toll on demand, he said.

“The market seems to be putting its weight behind economic slowdown and trade wars and slightly under-pricing risk that supply could be interrupted,” Hardy said.

Iran on Monday said it could cause further disruptions to shipping through the Strait of Hormuz. The country has seized several vessels near the strait, a bottleneck for a third of all seaborne oil shipments, and has been accused of carrying out attacks on tankers in the area in May and June. Oil prices rose after the incidents but have since edged into bear-market territory.



Share This:



More News Articles


New SHOWCASE Directory Companies

 

Gardner Denver
T.A. Cook
Presto GeoSystems
STEP Energy Services