By:
Ronnel W. Domingo - 05:04 AM June 17,
2019
Oil
consumers see relief as the global oil market has become volatile again mainly
due to a weak economic outlook that is partly dampened by the United States’
trade wars.
In its
latest monthly oil market report, the International Energy Agency noted that
world trade growth had fallen back to its slowest pace since the financial
crisis 10 years ago.
Last
month, prices of the global benchmark Brent crude oil fell to $60 a barrel from
$70 a barrel.
In the
Philippines, oil firms cut prices over the past three consecutive weeks by a
total of P4.20 a liter of diesel and P4.50 a liter of gasoline.
In Metro
Manila, diesel prices now range from P37.35 to P42.69 a liter. For gasoline,
prices are P44-P55.45 a liter.
“The
consequences for (global) oil demand are becoming apparent,” the IEA said. “In
the first quarter of 2019, growth was only 0.3 million barrels per day (mbpd)
versus a very strong first quarter of 2018 (which was a seven-year low).”
The
Paris-based agency said meeting the expected demand growth was “unlikely to be
a problem” considering that plentiful supply would be available from non-Opec
(Organization of Petroleum Exporting Countries) nations, which account for
two-thirds of global supply.
For
full-year 2019, IEA cut for the second month in a row its estimate for global
oil demand growth, which was now projected at 1.2 mbpd.
“A clear
message from our first look at 2020 is that there is plenty of non-Opec supply
growth available to meet any likely level of demand, assuming no major
geopolitical shock, and the Opec countries are sitting on 3.2 mbpd of spare
capacity,” the IEA said.
“This is
welcome news for consumers and the wider health of the currently vulnerable
global economy, as it will limit significant upward pressure on oil prices,” it
added. “However, this must be viewed against the needs of producers
particularly with regard to investment in the new capacity that will be needed
in the medium term.”
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