Recession Fears & Odds Grow
June 20, 2022
Bloomberg Economics models indicates the odds for a recession by 2024 have jumped to at least 72%. Many economists think the Fed needs to raise rates faster to slow down the economy and help ease inflation. The continued fear of a recession has taken some of the luster off the energy market and created some brief selling pressure last week. The fear of a recession versus low physical inventories continues to be a tug of war on where prices are headed.
JP Morgan forecast global oil demand increasing by 3.7 million bpd between May and the end of the year, with 1.7 million bpd coming from the China and 1.9 million bpd coming from APAC countries. (The APAC countries are thirteen counties from Asia and Pacific like Cambodia, Nepal, Bangladesh etc.)
The Baker Hughes Rig Count called oil rigs up four to a total of 584 oil rigs, the highest level since March 2020.
That National Bureau of Statistics reported that China’s crude oil production in May increased by 3.6% on the year to 17.567 million tons and output in the January-May period increased by 4.1% on the year to 85.69 million tons, while its gasoline output fell by 8.7% on the year to 11.6 million tons.
Russia’s idled primary oil refining capacity was revised down to 4.451 million tons in June, down 8.3% from the previous estimates. The revision follows several changes in Russian oil refinery maintenance schedules for this month.