The IEA, after warning on March 16 that 3 million barrels per day could be shut down from April, lowered that figure for the second time as it noted that only 1 million barrels per day were offline.
“Over time, steadily increasing volumes from OPEC+ from the Middle East and the United States, along with a slowdown in demand growth, should help address an acute supply shortfall in a backdrop of worsening Russian supply disruption,” the IEA said in its monthly oil report.
“Soaring pump prices and slowing economic growth are expected to significantly dampen demand recovery through the rest of the year and into 2023,” the IEA said, adding that restrictions aimed at containing Covid-19 in China were causing a prolonged economic slowdown there.
Reflecting slowing commodity exports and falling domestic demand, about a million barrels a day of Russian oil were shut down last month, about half a million less than the agency had expected.
The IEA sees that number rising to 1.6 million barrels a day in May, 2 million in June and nearly 3 million from July if sanctions deter buying or expanding.
The US and other IEA members have pledged to release 240 million barrels of oil in their second drawdown of emergency reserves this year after the IEA canceled a US-led release in November, as it saw no major supply disruptions at the time.
Russian exports rebounded in April by 620,000 barrels a day from the previous month to 8.1 million, the IEA said, returning to their January-February average as supply was diverted from the United States and from Europe, mainly to India.
While working on a ban on Russian oil, the European Union remained the top market for Russian oil exports last month, the IEA said, down just 535,000 barrels a day since the start of the year. the year.
The bloc now accounts for 43% of Russian oil exports, up from around 50% at the time.