With oil prices having eased substantially in recent weeks following an interim agreement between the US and Iran in mid-June aimed at curtailing hostilities, and regional maritime and military disputes, the prospect of higher export flows could provide some relief for Southeast Asian nations ahead of peak summer season demand.
Intergovernmental organisation the International Energy Agency’s (IEA’s) latest newsletter, published on June 29, highlights that oil demand has shifted considerably over the past four months in response to the oil crisis, with many consumers scaling back their energy use and governments taking steps to shelter households and businesses from the impacts, particularly in the Asia-Pacific region.
The IEA’s latest forecast observes that global oil demand fell by about five-million barrels a day in the second quarter, compared with the same period a year earlier.
The organisation adds that a surge in oil prices has incentivised market participants to draw down inventories at record rates, while the IEA’s largest-ever release of emergency stocks brought additional barrels to market.
On exporters, the newsletter states that there are some Gulf producers that are using alternative routes to market that bypass the Strait of Hormuz in the Middle East, as well as a surge in crude exports from other suppliers, especially the US.
