(The Canadian Press)

By Troy Gillard

OPEC, Pandemic wildcards going forward

Global oil demand on the rise: ATB Financial

Apr 7, 2021 | 8:59 PM

Average annual global oil consumption will rise by 5.5 million barrels per day in 2021 compared to last year, according to the Short-Term Energy Outlook released by the U.S. Energy Information Administration (EIA) Tuesday.

However, ATB Financial notes in its latest edition of ‘The Owl’ that the rebound is not enough to get back to the pre-pandemic level, with global consumption still down by 3.5 million barrels per day compared to 2019.

Global consumption will return to pre-pandemic levels in 2022.

Of critical importance to Alberta’s oil patch is that U.S. and Canadian oil consumption are forecast to grow this year and next, although by not quite enough to regain all the ground lost in 2020. U.S. consumption in 2022 is forecast to be 0.6 per cent below its 2019 level; Canada’s is expected to be 3.1 per cent lower.

The EIA is also forecasting a balanced market with supply roughly in line with demand over the next two years.

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If OPEC holds fast and does not flood the market, prices should stay relatively strong.

The other wild card is the path of the pandemic and its impact on demand. The forecast assumes strong GDP growth in the U.S. and the continued reopening of the global economy as vaccination levels increase.