Global oil demand is set to strengthen and surpass 2019 levels by March 2022 as countries reopen and economic activity rebounds, JP Morgan said in a research note on Wednesday.
The bank expects global oil demand to grow 3.5 million barrels per day (bpd) in 2022 to reach 99.8 million bpd —280 kilo bpd above 2019 levels.
“Despite the rapid pace of growth, only in July 2023 should U.S. supply return back to pre-COVID volumes – three years after negative WTI prices—leaving OPEC+ (the Organization of Petroleum Exporting Countries and its allies) firmly in control,” the note said.
The bank also expects Brent oil prices to average $88 per barrel in 2022 and $82 per barrel in 2023 and breach $90 per barrel sometime in the third quarter of 2022.
The United States said on Tuesday it would release millions of barrels of oil from strategic reserves in coordination with China, India, South Korea, Japan and Britain, to try to cool prices after OPEC+ producers repeatedly ignored calls for more crude.