With a stronger push from world leaders for green energy sources and following the scourge of the pandemic, it would appear that the demand for oil has significantly decreased. In fact, according to the International Energy Agency (IEA), a downward trend in the demand for oil will continue for the next 6 years!
In fact, according to S&P Global Analytics Future Energy Outlooks, the long-term global oil demand has decreased to just 2.5 million barrels a day!
The decrease in world oil supply and demand has led countries that are rich in natural resources like oil and natural gas along with oil and gas companies into a tailspin. Should they leave these precious resources untouched or find a new purpose for them?
Here are just three ways in which the world oil supply and demand have changed due to the pandemic, marking the global shift towards greener and more sustainable fuel options.
1. A New Beginning For The Oil Market
With the pandemic changing lives and livelihoods the world over, it can come as no surprise that there have been vast changes in the world’s oil supply and demand. With the strong push from world leaders for green energy sources, there has been an observable downward trend in the demand for oil and natural gas.
Due to this weaker demand for oil and critical governmental policies, major oil companies have been forced to reassess their strategies and potentially offer renewable sources of energy instead
2. Lowered Demand By Industrial Sectors Like The Aviation Sector
There has been reduced demand for oil by sectors like the aviation industry which took a pummeling when COVID-19 hit. With most airports emptied of travelers and with many borders closed off from welcoming foreigners, the airline industry saw a sharp decrease in flights. With fewer planes in the air, there was lowered demand for oil to fuel planes.
While focusing on the transportation sector, it is also worth noting that with the move towards using electric vehicles, there is a lower demand for petroleum to fuel cars. However, one upside as posited by S&P Global is that because of lowered oil prices, it makes conventional vehicles that run on oil much more competitive compared to their greener counterparts. This could potentially stir up a demand for oil again.
3. The Supply For Oil Might Never Get Back To Pre-Pandemic Levels
According to the IEA, it is not untoward to suggest that the demand for oil might never return to 2019 levels. With more people now adjusting to new ways of life including work-from-home options and the use of electric-powered cars, the demand for oil has stagnated and some experts fear it might not return to pre-COVID-19 demand levels.
More About Winson Oil
Founded in 1970 by Wilson Rodrigues, Winson Oil has established itself as one of Asia’s major energy trading companies. We have offices in various parts of the Asiatic continent including Hong Kong, the Philippines, and Bangalore.
Winson Oil is focused on guaranteeing customer satisfaction. With due diligence and strict compliance to the trading partner’s specifications, we focus on building relationships with partners and ensuring that their efforts and contributions are recognized.
With over 50 years of experience under our belt, we are always trying to understand the work of our partners better so that we can offer end-to-end supply chain solutions. These include onshore and offshore oil tanks, shipping service distribution, vessels, and essential logistics.
With a strong partner network, a fortified position in the market, and a deep sense of customer needs, we are zealous in offering the best services and solutions to our clients. We are proud to continue to provide integral solutions to our clients and hope to spread our reach to other regions. In fact, we have plans to open offices in countries like Australia and New Zealand.