OPEC says oil demand will exceed pre-pandemic levels in 2022.
Rising demand for oil, especially in China and India, will outweigh the increasing appeal of electric cars and growth in renewable energy next year, the oil cartel said.
Because of the rise of the Delta variant of the coronavirus, OPEC expects some of the recovery in oil demand previously forecast this year to be put off until 2022.Credit…Facundo Arrizabalaga/EPA, via Shutterstock
The Organization of the Petroleum Exporting Countries said on Monday that demand for oil was expected to rebound above pre-pandemic levels next year.
In its Monthly Oil Report, the group said that it expected oil demand to average 100.8 million barrels per day in 2022, compared with just over 100 million barrels a day in 2019 before the pandemic took hold.
The forecast is evidence that the world economy is still heavily dependent on emissions-causing fossil fuels, despite growing concerns about climate change and a steep fall in oil demand during the pandemic. The news emerged just as world leaders were preparing for what many analysts predict will be a crucial climate summit, known as COP26, in Glasgow in November.
Sales of electric cars have grown strongly, and investment in wind and solar energy has held up surprisingly well during the pandemic, but the growth in demand for energy, especially in China and India, will offset such gains, according to OPEC forecasts.
China, for instance, is expected to consume almost 15 million barrels a day in oil next year, 1.5 million barrels a day more than it burned in 2019.
The pandemic slammed oil demand, which plummeted by around nine million barrels a day last year, or about 9 percent, OPEC said. Oil consumption has recovered strongly, but the emergence of the fast-spreading Delta variant has applied the brakes. Now, OPEC expects some of the recovery in oil demand previously forecast this year to be put off until 2022.
In its report OPEC, said that it was raising its demand forecast for 2022 by 900,000 barrels a day while slightly lowering its estimates for the final three months of this year. Oil consumption will grow by a hefty 4.2 million barrels a day next year after a surge of six million barrels a day in 2021, according to OPEC.
“The pace in recovery in oil demand is now assumed to be stronger and mostly taking place in 2022,” OPEC analysts wrote.
Pan Shiyi, chairman of Soho China, and his wife, Zhang Xin, the chief executive, in 2019.Credit…Visual China Group via Getty Images
Shares of Soho China, a real estate company run by a prominent power couple, fell by one-third on Monday after Blackstone Group walked away from its deal to buy the firm.
Soho China said in a joint filing late on Friday that Blackstone would not go through with its $3 billion bid for a controlling stake in the company, without giving a reason. Blackstone, the Wall Street investment giant, and Soho China declined to comment further on Monday.
The company is controlled by Zhang Xin and Pan Shiyi, a married couple who share the title of executive director. Mr. Pan, who is chairman, was one of the first Chinese entrepreneurs to use social media for public relations and has tens of millions of followers online. Ms. Zhang is well known in part for her role in a 2013 deal to buy a stake in the General Motors Building in Manhattan.
The news comes as China’s most successful business tycoons come under scrutiny and growing pressure to share more of their wealth. The deal, which would have been among the real estate sector’s biggest, was announced in June, with a regulatory review pending. It was seen as a move by the husband-and-wife team to reduce their exposure to China.
A deal for Soho China could have also shored up confidence in the country’s real estate sector, which, after years of remarkable growth, is coming under greater regulatory scrutiny as Beijing tries to put a stop to corporate binge borrowing. Developers have been forced to start paying off mounting bills under new central bank rules, called the “three red lines.”
Evergrande, China’s biggest developer, has spooked investors, home buyers and experts who are predicting a bankruptcy in the near future.
In recent weeks, real estate prices and demand in some of China’s biggest cities has started to weaken. A prominent Beijing think tank last week said the sector had “shown signs of a turning point.”
Real estate woes, plus reports of greater regulatory tightening in mainland China, contributed to a drop of nearly 2 percent in Hong Kong shares on Monday.
Oil demand outlook: OPEC is scheduled to release a report providing oil demand estimates for next year. The demand outlook could be affected by mounting uncertainty caused by the Delta variant.
Consumer Price Index: The Labor Department is set to publish its monthly report on price increases. Investors will look for signals on whether inflation is temporary or could last longer than economists and policymakers currently expect.
Poverty report: The Census Bureau will release its annual report on income and poverty in the United States. Poverty is expected to have risen slightly last year, despite the huge increase in unemployment, signaling that government aid helped offset the economic impact of the pandemic.
Apple iPhone event: Apple is set to unveil its latest line of iPhones and other products at a virtual event.
Retail sales: The Commerce Department will publish data on spending for the month of August. Shopping at U.S. retailers dropped sharply in July, and another decline in sales could signal a slowdown in the broader economic recovery.
Consumer sentiment: The University of Michigan will publish its monthly consumer sentiment index, a key indicator into the economic recovery. The index fell more than 13 percent in July as consumers expected price increases to continue.
Students who went to ITT Technical Institutes, a problem-plagued chain that abruptly closed its doors in 2016, are among those whose loans have been forgiven.Credit… Sandy Huffaker for The New York Times
More than 500,000 student borrowers — with nearly $10 billion in student loan debt — had their loans erased this year, Stacy Cowley reports for The New York Times.
President Biden has so far fended off calls for the kind of blanket debt cancellation that is a top priority of many progressive lawmakers, but a parade of relatively modest eligibility and relief enhancements adds up to a significant expansion of support for beleaguered borrowers. And more may be coming: The Education Department said it was planning regulatory changes to programs aimed at helping public servants and those on income-driven repayment plans.
There is plenty of incentive for the federal government — the primary lender for Americans who borrow for college, holding $1.4 trillion in debt owed by 43 million borrowers — to fix faltering relief programs soon. Since the pandemic took hold in March 2020, virtually all of those loans have been on an interest-free pause, which is scheduled to end Jan. 31. And every loan discharged is one fewer for the agency to service.
The department’s actions so far have generated little controversy — few oppose giving military personnel, disabled borrowers and defrauded students the relief to which they’re legally entitled — but the idea of more broadly canceling student debt is a lightning rod. Republicans dislike the idea of saddling taxpayers with the cost, and its critics on the left see it as a subsidy for those with expensive professional degrees.
“Our overall goal is permanent change,” said Kelly Leon, an Education Department spokeswoman. “We are building a student loan system that works for borrowers and provides them the relief authorized by Congress that has proven elusive for far too long.”
The push for widespread debt cancellation has overshadowed calls to mend glaring administrative problems that urgently need to be addressed, advocates say. READ THE ARTICLE ->
By taking into account rent payments, Fannie Mae claims it could make as many as 17 percent of people more qualified for mortgages.Credit…Ryan Christopher Jones for The New York Times
Fannie Mae, the federally backed institution that buys mortgages from the banks, plans to peer into many people’s bank accounts — with their permission — for a record of regular rent payments to help assess qualification for mortgages.
Its data showed that only 17 percent of people who had not owned a home in the previous three years and would not have qualified for a mortgage before might do so now. But those 17 percent are drawn from a group that is disproportionately people of color, many of whom have limited credit histories and come from marginalized groups on the wrong side of a decades-long wealth gap.
Fannie Mae effectively sets many of the standards for who qualifies and what data counts, and until now, rent has not counted, despite it being the largest payment most renters make each month. For many years now, consumer advocates and industry insiders alike have agreed that this is not how things should be.
The convoluted, multistep process that Fannie is using will mean many people won’t benefit from it at first. The New York Times’s Your Money columnist, Ron Lieber, takes a look ->
U.S. stocks rose in early trading Monday, with indexes pointing to a rebound after losses for five consecutive trading sessions. The S&P 500 ticked up 0.3 percent after its worst losing streak since February last week, while the Nasdaq composite was flat.
The Labor Department is set to publish its latest report on rising prices on Tuesday. The Consumer Price Index, a key inflation gauge, for August is expected to signal whether the increasing prices in the pandemic are temporary or will fade over time as Federal Reserve officials consider when to begin slowing its large-scale bond purchases.
European stock indexes were higher, with the Stoxx Europe 600 ticking up 0.7 percent. Asian markets were mixed.
Oil prices rose with West Texas Intermediate, the U.S. crude benchmark, up 1.2 percent to $70.53 a barrel. The Organization of the Petroleum Exporting Countries raised its forecast for global oil demand for 2022 to 100.8 million barrels a day, the cartel reported on Monday in its Monthly Oil Market Report.