Strait of Hormuz Closure Slams Global Oil Demand, IEA Warns
The International Energy Agency (IEA) has revised its forecast for global oil demand downward, citing the ongoing closure of the Strait of Hormuz and renewed hostilities in the region.
The agency predicts a decline in demand by 1.6 million barrels per day in 2023, surpassing its previous estimate of 510,000 barrels per day more than its last monthly prediction in July.
This downward revision is attributed to high fuel prices, which will continue to weigh on consumption, although demand is expected to pick up through the year and return to growth in the final quarter.
The situation in the Strait of Hormuz remains unresolved, with neither side able to agree on an agreement to open the vital waterway. As a result, 'renewed hostilities and maritime disruptions' are undermining efforts to boost global oil supply, which is currently 6.3 million barrels per day lower year-on-year.