Global oil demand will rise slightly – by more than 2 MMbbl/d – in 2023, driven primarily by China, Fatih Birol said, executive director of the International Energy Agency (IEA), during a video interview with Bloomberg on June 22.

Birol said about 60% of the demand will come from China.

“If the Chinese economy rebounds stronger than we assume, because we think it's a more sluggish growth … [and] looking at the demand-supply picture [for the] second half of this year, given the cuts some of the producing countries are going to carry out, we may see some tightness in the markets,” he told Bloomberg.

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When asked about gas prices in Europe ahead of winter, the IEA director said many governments and leaders were too “relaxed” due to the amount of gas already in storage in Europe.

He cautioned against optimism for two main reasons. “One, if the Chinese economy is strong, they will buy a lot of LNG from the markets,” Birol said. “This year is different, as the amount of new additional LNG coming to markets is one of the lowest in history and there will not be enough LNG for Europe left to buy.”

Birol also said a very harsh winter could also be a big problem for Europe in terms of prices.

“Just looking at the current gas storage levels, we may see the gas prices, which are lower now, to come up higher,” Birol said.

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