The International Energy Agency (IEA) expects global oil demand to see its first quarterly decline in more than a decade due to the negative impact of the Coronavirus on Chinese economy.
The Paris-based IEA said in its monthly report released on Thursday that it expects global crude demand to fall by 435,000 barrels per day (bpd) in the first quarter of 2020, compared to the same period last year.
This quarterly decline in global oil demand would be the first in more than 10 years, according to the IEA.
Expectations of a decline in global crude demand in the first quarter prompted the agency to lower its 2020 demand growth estimates by 365,000 barrels per day to 825,000 bpd, the lowest level since 2011.
The Energy Agency also said that lower-than-expected consumption from OECD countries has reduced estimates of global crude demand growth for 2019 to 885,000 barrels per day.
The IEA's projections of a reduction come as the Coronavirus, which has infected more than 59,000 people in China and has killed more than 1,300 people, continues to weigh on global market sentiment and China's economic activity.
The energy agency said the consequences of the new Coronavirus will be significant for global demand for crude, oil prices and producers.
"At the producer level, prior to the Corona crisis, the market was expected to move towards balance in the second half of 2020 due to a combination of production cuts implemented at the beginning of the year, increased demand and reduced supply from outside OPEC," the IEA added.
According to the monthly report released by OPEC on Wednesday, estimates of global oil demand growth in 2020 have been revised down by 0.23 million barrels per day to 0.99 million barrels per day.