Fresh data from the Joint Organizations Data Initiative (JODI) has revealed that the global demand for crude oil dropped by 1.1 million barrels per day in July, a month that normally sees a seasonal rise in demand.
The reduced consumption mostly occurred in developed European economies, India, Saudi Arabia, Indonesia and China. China in particular has experienced a number of COVID-19-related lockdowns that have affected travel in the country. While its July consumption was still above pre-pandemic levels, its annual consumption is expected to decline this year for the first time since 1990.
A press release said that the drop in demand was counter-seasonal and influenced by slowdowns:
“In OECD Europe, India, China, Saudi Arabia, and Indonesia, [as] new data from the Joint Organizations Data Initiative (JODI) shows. The drop sits in contrast to the five-year average for the month of July, excluding the pandemic years of 2020-2021, which shows demand rising seasonally by an average of 350,000 b/d.”
The drop in demand meant that global product inventories increased three times more than usual at 63 million barrels, while inventories of crude oil jumped by nine million barrels, although overall inventories remained below historic levels.
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