(Updated with chart, details)
By Noah Browning
LONDON, Feb 15 (Reuters) – China will account for nearly half of oil demand growth this year after easing its COVID-19 restrictions, the International Energy Agency (IEA) said on Wednesday. , but the OPEC+ production lockdown could mean a supply shortage in the second half.
“OPEC+ supply is set to contract as Russia comes under sanctions pressure,” the Paris-based agency said in its monthly oil report.
“Global oil supply is expected to exceed demand in the first half of 2023, but the balance could quickly turn into a deficit as demand recovers and some Russian production shuts down.”
The IEA expects oil demand to increase by 2 million barrels per day (bpd) in 2023, with China accounting for around 900,000 bpd.
The figure represents an increase of 100,000 bpd from last month’s forecast, reaching a record high of 101.9 million bpd.
The IEA adds that with increased air travel as the pandemic subsides, jet fuel will be one of the mainstays of global demand recovery.
The IEA’s forecast is slightly lower than the 2.3 million bpd growth projected in Tuesday’s IEA report.
Organization of Petroleum Exporting Countries
(OPEC), which together with allies like Russia form the OPEC+ group.
International sanctions against Russia, aimed at depriving it of funds after invading Ukraine, have so far had little impact on its oil exports, which in January fell by just 160,000 barrels a day (bpd) compared to pre-war levels.
However, according to the IEA, by the end of the first quarter, production of around 1 million barrels per day will have been shut down, due to the European ban on maritime imports and international price cap sanctions.
“It is not yet clear how the embargo and EU price cap on petroleum products that came into effect earlier this month will affect trade flows,” the IEA said. “Our forecast is that part of Russian oil (production) will have to be shut down as a result.”
The agency initially expected 3 million barrels of Russian oil to be shut down a day after Moscow invaded Ukraine.
(Reporting by Noah Browning; Editing in Spanish by Ricardo Figueroa)