UPDATE 2-IEA raises 2020 oil demand forecast but warns COVID-19 clouds outlook

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By Noah Browning
LONDON, July 10 (Reuters) - The International Energy Agency
(IEA) bumped up its 2020 oil demand forecast on Friday but
warned that the spread of COVID-19 posed a risk to the outlook.
The Paris-based IEA raised its forecast to 92.1 million
barrels per day (bpd), up 400,000 bpd from its outlook last
month, citing a smaller-than-expected second-quarter decline.
"While the oil market has undoubtedly made progress ... the
large, and in some countries, accelerating number of COVID-19
cases is a disturbing reminder that the pandemic is not under
control and the risk to our market outlook is almost certainly
to the downside," the IEA said in its monthly report.
The easing of lockdown measures in many countries caused a
strong rebound to fuel deliveries in May, June and likely also
July, the IEA said.
But oil refining activity in 2020 is set to fall by more
than the IEA anticipated last month and to grow less in 2021, it
said.
Demand in 2021 will likely be 2.6 million bpd below 2019
levels, with kerosene and jet fuel due to a drop in air travel
accounting for three-quarters of the shortfall.

"For refiners, any benefit from improving demand is likely
to be offset by expectations of much tighter feedstock markets
ahead. Refining margins will also be challenged by a major
product stocks overhang from the very weak second quarter of
2020," the IEA said.
On the supply front, the IEA said the Organization of the
Petroleum Exporting Countries and other producers including
Russia, a grouping known as OPEC+, had shown 108% compliance
with their pact to rein in output.
Market driven cuts had also affected other producers,
especially the United States, though U.S. supply was expected to
slowly recover in the second half of 2020 while the lifting of
force majeure on exports of Libyan crude could add another
900,000 bpd to global markets by the end of the year.

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Global oil supply and demand https://tmsnrt.rs/3fhIP8u
Oil demand change by product https://tmsnrt.rs/2OoFxop
Lockdown versus new cases https://tmsnrt.rs/2ZTUowm
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