The global liquid fuels demand is now 378,000 barrels per day less than was forecast in January, Jordan Knauff reported. The difference is driven by lower-than-expected heating fuel consumption caused by a warmer winter, an expected slowing of economic growth in general, and the economic effects of the COVID-19 outbreak.
Effects on the Pumps Industry
“Companies are formulating travel protocol on a daily basis,” John Malinowski, a Pumps & Systems Editorial Advisory Board member and industrial motor consultant, said last week. “It is clear that most are restricting international travel, particularly to hot spots of mass infection. But how do we know where that really is as the virus spreads? Some companies are restricting all travel.
“I expect trade show attendance may suffer,” Malinowski said. “Perhaps they should be canceled or postponed. Conferences should do the same or at least be prepared to offer web-based attendance for those who choose not to attend in person.”
“Due to travel restrictions and restraints at gathering at large public national and international events, there are certain high-profile market sectors that are going to be impacted temporarily by the COVID-19 outbreak,” said Chris Wilder, Pumps & Systems Editorial Advisory Board member and CEO of Sealing Equipment Products Co., Inc. (SEPCO). “Our hope at SEPCO is that the impact doesn’t lead to unfounded economic impact to other markets due to purely reactionary measures.
“But the threat and the severity of impact to the health and wellbeing of those on the front lines of care or with compromised immunity is real and needs to be addressed in collaboration by the globes best experts.”
Future Predictions
Jordan Knauff reports that economic growth in China will bounce back once the effects of COVID-19 have faded. By the end of this year, the EIA expects petroleum demand to get closer to the levels forecast in January.
On Wall Street, the Dow Jones Industrial Average lost 10 percent, the S&P 500 Index fell 8.4 percent, while the NASDAQ Composite slipped 6.4 percent for the month of February. The coronavirus pushed investors into defensive stocks and safe haven assets like treasury bonds and gold, according to Jordan Knauff. Growth and corporate earnings projections from several companies have been reduced due to the virus.