The IEA cut its projected global demand for oil for 2009 to 83.2 million barrels per day, a 3% drop from 2008. It is the biggest year over year decline since 1981. It’s also the ninth straight month the IEA has cut its forecast.
The IEA also took the opportunity to put down an illusions about early signs of economic recovery, writing “as far as oil is concerned, the latest available data indicate that the ‘demand green shoots’, if any, continue to be buried under the thick ice of the current economic winter.”
While the green shoots that do exist are welcome news, the IEA thinks its just a rebuilding of inventories, and it’s “arguably premature to predict an imminent and strong economic rebound…the recovery could conceivably be more ‘L‐shaped’ (i.e., shallow), as the IMF and others posit.”
Oil is trading down around $56.60 as of this writing, sliding for the second straight day after jumping over $60.
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