Saudi oil giant Aramco expects oil demand to recover in the later half of 2020.
Amin Nasser, CEO at Aramco said: “The worst is behind us, adding that more countries will start opening up which will reflect in higher demand for crude.”
Nasser expects oil demand to average between 95 to 97 million barrels per day by the end of the year.
At its lowest, oil demand hit just 75 million per day in April, Nasser said.
Visit Business Insider’s homepage for more stories.
Saudi state giant Aramco expects oil demand to rebound in the latter half of the year as economies move out of COVID-19 lockdowns and travel demand returns.
Amin Nasser, chief executive of Saudi Aramco, said at a virtual CERAWeek Conversations event Tuesday: “I’m very optimistic about the second half of this year, due to higher than expected demand during the coronavirus lockdowns.”
He added: “More countries will start opening up, so we see that reflected in the demand on crude.”
Nasser highlighted oil demand has already recovered to about 90 million barrels per day.
Demand hit a low of between 75 million and 80 million barrels in April, he said.
He expects oil demand to level between 95 to 97 million barrels per day by the end of 2020, depending on whether another wave of coronavirus breaks out or not.
Read more: Goldman Sachs has formulated a strategy that could triple the market’s return within a year as volatility remains higher than normal — including 11 new stock picks for the months ahead
Nasser said: “There are different forecasts looking at between 95 and 97 million barrels of oil per day by year-end, so it will all depend on whether there will be a second wave of coronavirus or not.”
Nasser is more bullish than what the International Energy Agency is forecasting for 2020. The IEA forecast oil to average 91.7 million barrels per day due to stronger than expected deliveries during the COVID-19 lockdown.
Oil prices took a beating in recent months, and US oil prices even turned negative in April due to lack of demand during COVID-19 and lack of storage space, particularly at a key storage hub in Cushing Oklahoma.
Read more: JPMorgan breaks down how COVID-19 nearly destroyed one of the market’s safest trades — and lays out 3 lessons to help investors tackle future crises
But both West Texas Intermediate and Brent, the international benchmark, rebounded in May and June as economies began to ease lockdowns.
OPEC production cuts that took place in May and June also helped shore up the price of the battered commodity.
OPEC+ had agreed to cut 9.7 million barrels of oil per day in May and June. Last month production cuts were extended until the end of July.
Brent is trading 91% higher since touching a yearly low of $21.44 on 20 April, and on Wednesday is trading around $41 per barrel.