Global oil demand could soar as much as 4% at some point next year if the world fully emerges from Covid restrictions, hedge fund trader Pierre Andurand said.
(Bloomberg) — Global oil demand could soar as much as 4% at some point next year if the world fully emerges from Covid restrictions, hedge fund trader Pierre Andurand said.
Consumption has been lagging long-term trends and — bolstered by a switch to oil from gas — may increase by 3 million to 4 million barrels a day in 2023, according to posts on Twitter by Andurand. His main commodities fund has gained about 50% this year.
Crude picked up earlier this month as China, the world’s biggest oil importer, relaxed the strict Covid Zero policy measures it had imposed to try and eliminate the disease. But the market has faltered again on concern that Beijing’s rapid pivot has unleashed a massive new outbreak of the virus.
The oil demand surge will likely be limited by the increasing popularity of electric vehicles, which are displacing about 600,000 barrels a day of fuel use, Andurand said.
Andurand is among several fund managers who made huge profits betting that supply-chain disruptions and Russia’s invasion of Ukraine would lead to jumps in oil and other commodities.
Wall Street banks widely expect that crude prices, trading near $82 a barrel in London, will advance next year as sanctions squeeze Russian supplies.
Still, the bullish mood isn’t unanimous. Veteran analyst Gary Ross at Black Gold Investors LLC tweeted on Wednesday that oil market balances are “weak” and will deteriorate further in early 2023 as US storms curb refinery operations.
(Updates with more detail after third paragraph.)
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