World oil storages will be filled to capacity

US, WASHINGTON (ORDO NEWS) — World oil storages will soon be full – such an opinion was expressed by the head of the International Energy Agency Fatih Birol. This is due to the disruption of the OPEC + transaction, as well as a sharp reduction in energy consumption due to an outbreak of coronavirus.

World oil storages will be filled to capacity
File Reuters

At the same time, Birol noted that the restoration of demand will not be easy and quick, and urged the main market players to take a more responsible position.

World demand for oil due to coronavirus could fall by 20 million barrels per day, which is about 20%, said Fatih Birol, head of the International Energy Agency.

“Today, three billion people cannot move. As a result, it can go up to 20 million barrels per day,” the Prime agency quoted him as saying.

According to the head of the IEA, daily demand is about 100 million barrels, 60% of which goes to fuel for transport. Due to restrictions on air travel and quarantine in many countries, demand is falling in the light of coronavirus.

In addition, Fatih Birol also noted that many enterprises engaged in the production of liquefied natural gas may stop working. The contracts of the largest LNG exporters are tied to oil prices, and they will suffer greatly.

“Many countries exporting LNG, such as Australia and Qatar, whose contracts are tied to oil prices, will be seriously affected. I would expect the US LNG sector to suffer from this. We may well see multiple closures around the world,” said he.

Birol did not rule out that lower prices will push many countries to switch from coal to gas.

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