A fast-spreading coronavirus in China has pushed OPEC and allied producers to consider deepening crude supply curbs. For the first time since the depths of the financial crisis in 2009, oil demand is set to fall year on year in Q1 because of the outbreak, the International Energy Agency (IEA) said.
For demand in 2020, the US Energy Information Agency and the OPEC also cut their outlooks. Since the beginning of the year, Brent crude LCOc1 is down roughly 15 percent as the virus has spread.
After the outbreak hit gas demand in China, four LNG tankers bound for North Asia have changed destination or diverted. While domestic air travel fell 50 percent, early stages of the outbreak crisis led to a 70 percent fall in international air traffic in China.
The OPEC and its allies are in discussions to consider deepening oil supply curbs by an additional 500,000 bpd to 2.2 million bpd and to bring forward a policy meeting to this month from March.