The rising number of coronavirus infections are sparking concern over a potential slowdown in global demand growth for oil in the second half of 2020, as countries consider reimposing strict measures to contain a potential second wave of the pandemic.
Oil demand growth has slumped this year due to strict mobility measures in place across the world but measures taken by Opec and its allies to restrict supply shored up prices. Brent was down 0.57 per cent at $45.20 per barrel at 7.39am UAE time, while WTI was down 0.40 per cent at $42.72 per barrel.
The International Energy Agency last week cut demand growth projections for the first time in many months by 140,000 barrels per day, while Opec pared its forecast by 100,000 bpd.
“Demand recovery, especially for the second half of this year will be slower than the first half of this year,” said Zhuwei Wang, lead analyst, Middle East commodity analytics at S&P Global Platts.
He cited the potential for a second outbreak of the virus as a looming concern for oil markets. The coronavirus has infected more than 22 million people as of Tuesday, according to Worldometer, which tracks the pandemic. Around 778,102 have succumbed to the disease so far. Countries that contribute to significantly driving demand growth for oil, such as the US, Brazil, India, Russia and South Africa, have the highest number of infections globally.
Platts Analytics estimates that oil demand will decline by 8.2 million bpd year-on-year in 2020, but will increase again by 6.7m bpd in 2021.
“In 2021 even if we are seeing some kind of demand recovery, the absolute will still be 1.5m bpd lower than 2019,” said Mr Wang.
In comparison, the IEA has forecast an 8.1m bpd slide in demand for 2020, while Opec expects oil demand to grow by 7m bpd in 2021.
Oil demand growth is expected to remain tepid long-term once the pandemic’s impact on education and the future workforce is also considered.
“In the mid-term maybe ... 400 million [fewer] people will enter into the middle class in the next 10 to 20 years and that actually will be translated into a huge amount of demand losses,” Mr Wang said.
"Covid-19 will lead to a lot of young people dropping out of school, [resulting in a] labour force with potential lower wages, leading to lower disposable income and that will all translate into lower demand growth,” he added.
In June, the World Bank estimated a 5.2 per cent contraction in global gross domestic product for 2020 as the pandemic triggers the deepest recession since the Great Depression.
Consultancy Wood Mackenzie also maintains a pessimistic view of oil demand recovery in the near term, citing the continued impact of Covid-19.
“Our H1 2020 outlook anticipates an oil price rebound as demand starts rising post-coronavirus. However, a second large-scale lockdown [across major economies] would deepen the recession, and possibly delay any rebound in GDP until 2022. This would have a significant impact on the oil and gas sectors,” said Dulles Wang, director, Americas gas research at Wood Mackenzie.
The consultancy sees Brent rising to $86 per barrel by 2030 in its base scenario. However, in the event of a second wave, resulting in widespread movement restrictions, the international benchmark is forecast to fall to $70 per barrel over the same period.
Meanwhile, on the supply side, Opec+ producers are continuing to cut back production, albeit in a tapered manner. The group, which is currently slashing 7.7m bpd, is convening its joint ministerial monitoring committee on Wednesday.
The group will "reiterate the strong compliance level” but maintain focus on elevating the level of conformity in an environment where oil demand remains fragile, said Giovanni Staunovo, commodity analyst at UBS.
Opec+ which has Saudi Arabia and Russia at the helm, will receive plans from Iraq, Angola, Kazakhstan and Nigeria on implementing compensatory cuts to make up for their lack of compliance in the second quarter.
UBS expects the markets to be undersupplied for the rest of the year, with Brent reaching $55 per barrel in the first half of 2021. Supply from the US shale basins, however, is unlikely to recover until West Texas Intermediate climbs above the $50 per barrel mark, Mr Staunovo said.
What can victims do?
Always use only regulated platforms
Stop all transactions and communication on suspicion
Save all evidence (screenshots, chat logs, transaction IDs)
Report to local authorities
Warn others to prevent further harm
Courtesy: Crystal Intelligence
Company profile
Name: Oulo.com
Founder: Kamal Nazha
Based: Dubai
Founded: 2020
Number of employees: 5
Sector: Technology
Funding: $450,000
Electric scooters: some rules to remember
- Riders must be 14-years-old or over
- Wear a protective helmet
- Park the electric scooter in designated parking lots (if any)
- Do not leave electric scooter in locations that obstruct traffic or pedestrians
- Solo riders only, no passengers allowed
- Do not drive outside designated lanes
Terror attacks in Paris, November 13, 2015
- At 9.16pm, three suicide attackers killed one person outside the Atade de France during a foootball match between France and Germany
- At 9.25pm, three attackers opened fire on restaurants and cafes over 20 minutes, killing 39 people
- Shortly after 9.40pm, three other attackers launched a three-hour raid on the Bataclan, in which 1,500 people had gathered to watch a rock concert. In total, 90 people were killed
- Salah Abdeslam, the only survivor of the terrorists, did not directly participate in the attacks, thought to be due to a technical glitch in his suicide vest
- He fled to Belgium and was involved in attacks on Brussels in March 2016. He is serving a life sentence in France
Day 1, Abu Dhabi Test: At a glance
Moment of the day Dimuth Karunaratne had batted with plenty of pluck, and no little skill, in getting to within seven runs of a first-day century. Then, while he ran what he thought was a comfortable single to mid-on, his batting partner Dinesh Chandimal opted to stay at home. The opener was run out by the length of the pitch.
Stat of the day – 1 One six was hit on Day 1. The boundary was only breached 18 times in total over the course of the 90 overs. When it did arrive, the lone six was a thing of beauty, as Niroshan Dickwella effortlessly clipped Mohammed Amir over the square-leg boundary.
The verdict Three wickets down at lunch, on a featherbed wicket having won the toss, and Sri Lanka’s fragile confidence must have been waning. Then Karunaratne and Chandimal's alliance of precisely 100 gave them a foothold in the match. Dickwella’s free-spirited strokeplay meant the Sri Lankans were handily placed at 227-4 at the close.
UAE currency: the story behind the money in your pockets
How has net migration to UK changed?
The figure was broadly flat immediately before the Covid-19 pandemic, standing at 216,000 in the year to June 2018 and 224,000 in the year to June 2019.
It then dropped to an estimated 111,000 in the year to June 2020 when restrictions introduced during the pandemic limited travel and movement.
The total rose to 254,000 in the year to June 2021, followed by steep jumps to 634,000 in the year to June 2022 and 906,000 in the year to June 2023.
The latest available figure of 728,000 for the 12 months to June 2024 suggests levels are starting to decrease.
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Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
More on animal trafficking
Pearls on a Branch: Oral Tales
Najlaa Khoury, Archipelago Books
RESULT
Norway 1 Spain 1
Norway: King (90 4')
Spain: Niguez (47')
SPEC SHEET
Display: 10.9" Liquid Retina IPS, 2360 x 1640, 264ppi, wide colour, True Tone, Apple Pencil support
Chip: Apple M1, 8-core CPU, 8-core GPU, 16-core Neural Engine
Memory: 64/256GB storage; 8GB RAM
Main camera: 12MP wide, f/1.8, Smart HDR
Video: 4K @ 25/25/30/60fps, full HD @ 25/30/60fps, slo-mo @ 120/240fps
Front camera: 12MP ultra-wide, f/2.4, Smart HDR, Centre Stage; full HD @ 25/30/60fps
Audio: Stereo speakers
Biometrics: Touch ID
I/O: USB-C, smart connector (for folio/keyboard)
Battery: Up to 10 hours on Wi-Fi; up to 9 hours on cellular
Finish: Space grey, starlight, pink, purple, blue
Price: Wi-Fi – Dh2,499 (64GB) / Dh3,099 (256GB); cellular – Dh3,099 (64GB) / Dh3,699 (256GB)
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
If you go
Flights
Emirates flies from Dubai to Phnom Penh with a stop in Yangon from Dh3,075, and Etihad flies from Abu Dhabi to Phnom Penh with its partner Bangkok Airlines from Dh2,763. These trips take about nine hours each and both include taxes. From there, a road transfer takes at least four hours; airlines including KC Airlines (www.kcairlines.com) offer quick connecting flights from Phnom Penh to Sihanoukville from about $100 (Dh367) return including taxes. Air Asia, Malindo Air and Malaysian Airlines fly direct from Kuala Lumpur to Sihanoukville from $54 each way. Next year, direct flights are due to launch between Bangkok and Sihanoukville, which will cut the journey time by a third.
The stay
Rooms at Alila Villas Koh Russey (www.alilahotels.com/ kohrussey) cost from $385 per night including taxes.
A Long Way Home by Peter Carey
Faber & Faber
The Great Derangement: Climate Change and the Unthinkable
Amitav Ghosh, University of Chicago Press
UAE currency: the story behind the money in your pockets
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SPECS
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