Record 2020 oil demand fall due to coronavirus: energy watchdog

For 2020 overall, demand will fall by 9.3 million barrels per day because of the coronavirus outbreak, according to the International Energy Agency. (Reuters)
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Updated 15 April 2020

Record 2020 oil demand fall due to coronavirus: energy watchdog

  • Measures taken to bolster the global economy and to reduce oil supply should allow a ‘gradual’ recovery in the second half of the year

PARIS: Global oil demand will fall by a record amount this year as lockdown measures imposed to curb the coronavirus outbreak bring the economy to a virtual halt, the International Energy Agency (IEA) said Wednesday.

For 2020 overall, demand will fall by 9.3 million barrels per day (mbd), with April alone down 29 mbd from a year earlier to levels last seen in 1995, the IEA said in its latest monthly report.

However, measures taken to bolster the global economy and to reduce oil supply should allow a “gradual” recovery in the second half of the year, it said.

The International Monetary Fund (IMF) warned Tuesday that the coronavirus pandemic is pushing the world into its deepest recession in a century, with economic output expected to shrink three percent.

It also said there could be a strong rebound in 2021, with growth of 5.8 percent, although it cautioned that with so many uncertainties in the mix, any forecasts must be tentative.

In similar language, the IEA said “the global economy is under pressure in ways not seen since the Great Depression in the 1930s,” warning that even if restrictions are eased later this year, the 2020 fall in demand of 9.3 mbd will erase “almost a decade of growth.”

On the positive side, authorities have responded with “radical steps,” launching massive stimulus programs costing trillions to tide their economies through the worst of the crisis.

“We are also seeing measures being taken to tackle the oil market crisis,” the IEA noted, referring to an OPEC deal with its OPEC+ allies at the weekend to cut production by an initial 9.7 mbd.

“In light of the unprecedented depth of the crisis, the IEA has urged major consumers and producers to work together through the forum of the G20 to mitigate the impact on market stability,” it said.

G20 countries have agreed to support the OPEC+ cuts which US President Donald Trump says could amount in all to 20 mbd, an unprecedented reduction in output.

The IEA said that combined, the OPEC+ and G20 actions “won’t rebalance the market immediately.

“But by lowering the peak of the supply overhang and flattening the curve of the build-up in stocks, they help a complex system absorb the worst of this crisis, whose consequences for the oil market remain very uncertain in the short term,” the IEA said.

For April, the IEA expects a fall in demand of up to 29 mbd year-on-year, followed by 26 mbd in May and 15 mbd in June.

The IEA warned that “there is no feasible agreement that could cut supply by enough to offset such near-term demand losses.

“However, the past week’s achievements are a solid start and have the potential to start to reverse the build-up in stocks as we move into the second half of the year.”

The IEA said it was possible that if production falls sharply, reserves are built up and economies recover, then “the second half of 2020 will see demand exceed supply.”

“Indeed, our current demand and supply estimates imply a stock draw of 4.7 mbd in the second half,” it said.

Oil industry capex this year was expected to fall by 32 percent to $335 billion, the lowest level for 13 years, the IEA added.


Egypt banks step up anti-virus efforts

Updated 26 November 2020

Egypt banks step up anti-virus efforts

  • asures recommended by the Federation of Egyptian Banks also include a ban on face-to-face meetings.

CAIRO: Up to half of bank employees in Egypt will be encouraged to work from home under guidelines to counter a second wave of the coronavirus pandemic.

Measures recommended by the Federation of Egyptian Banks (FEB) also include a ban on face-to-face meetings.

In a letter to banks, the FEB said its guidelines were aimed at ensuring sustainable operations “in the current circumstances.”

Banks will continue to operate from 8.30 a.m. to 3 p.m. for the public and from 8 a.m. to 4 p.m. for employees.

Previous guidelines were issued by the FEB on March 30 and April 5.

The federation's latest plan includes a follow-up on alternative workplaces to allow departments to continue working in cases of forced interruption.

The plan also issues strict instructions on wearing face masks in the workplace and while using the bank’s buses.

Employees also have been urged to follow precautionary measures while using public or private transport, and to avoid crowded places.

The FEB banned face-to-face meetings, replacing these with video conference meetings, and also underlined instructions to sanitize all surfaces using alcohol-based sanitizers, to regularly sanitize all workplaces at weekends, to provide sanitizers in areas that host employees and clients, and to regularly sanitize all main elevators.

Office boys and janitors have been instructed to wear face masks and to use paper cups instead of glass or metal ones.

The FEB said it will continue to post awareness videos and statements on combating the coronavirus.

It has urged banks to use e-payments, to continue banning delivery persons from entering the workplace, to continue halting the delivery of daily newspapers and magazines, and to continue temperature testing by security officials at workplace entrances.