IEA Forecasts Record High Oil Demand Next Year as China Lifts COVID Lockdowns

International Energy Agency Monthly Report

The sun setting over an oil production facility in Texas, USA.
Photo by EPA Yonhap News

[Asia Economy Reporter Na Ye-eun] As China's COVID-19 lockdowns are lifted and the economy recovers, global oil demand is expected to surpass pre-COVID-19 levels next year.

The International Energy Agency (IEA) stated in its monthly report released on the 15th (local time) that global oil demand will reach a record high of 101.6 million barrels per day next year, an increase of 2.2% compared to this year.

The IEA forecasted that while high oil prices and economic slowdown factors will suppress demand, the effect of increased demand as China emerges from COVID-19 lockdowns will offset this.

Additionally, due to current sanctions on Russia and cautious production increases by the Organization of the Petroleum Exporting Countries (OPEC), supply has been constrained, causing oil prices to rise; however, supply is expected to soon align with demand.

However, if the effects of Russian sanctions and the increase in Chinese demand are larger than expected, or if supply disruptions such as Libya's supply halt occur, the supply-demand balance could be disrupted.

The IEA report also noted that Russia's oil export revenue in May reached about $20 billion (25.83 trillion KRW), an 11% increase from the previous month, returning to pre-Ukraine invasion levels. Although export volumes decreased due to Western sanctions, higher oil prices led to increased export revenue.

Meanwhile, domestic fuel prices are also soaring. According to the Korea National Oil Corporation's oil price information service Opinet, as of 11 a.m. on the 15th, the average diesel price at gas stations nationwide rose by 3.48 KRW from the previous day (14th) to 2,085.46 KRW per liter, and the average gasoline price increased by 4.21 KRW to 2,087.88 KRW per liter.

This content was produced with the assistance of AI translation services.