Global oil traders Vitol and Trafigura expect a resurgence in coronavirus cases in Europe and the United States to hurt fuel demand although their estimates vary.
A second virus wave would see oil demand destruction at about 1 million barrels per bay (bpd) in the United States and 1.5 million bpd in Europe, Trafigura’s Executive Chairman & Chief Executive Officer Jeremy Weir said at a Financial Times event in Singapore on Monday.
“As we move now into what we consider the second wave, our anticipation is to see for further demand destruction… So it’s really not looking good for the foreseeable future,” Weir said on Monday.
Trafigura expects oil demand to fall to around 92 million bpd or below in the short term, while Vitol sees winter demand at 96 million bpd.
“The latest European lockdowns definitely will affect demand, but probably only by half a million barrels a day, across Northwest Europe,” Vitol CEO Russell Hardy said, adding that this would be on top of what was already impacted.
The heads of both trading companies said oil demand in most Asian markets, led by China and India, have rebounded except for jet fuel.
Vitol’s Hardy said he still expects Asia’s oil demand to grow by about 1 million bpd over the next few years.
Reporting by Florence Tan and Koustav Samanta; editing by Louise Heavens