The oil demand growth likely to fall, the economic impact of the coronavirus incomparable with the Sars epidemic.
Oil demand this year will fall to the lowest levels since 2011 as the coronavirus from China has been transmitting around the world, the International Energy Agency stated.
In its monthly oil market report, the Paris-based body informed that it had cut its 2020 growth forecast to 825,000 barrels a day from 1.2m initially forecasted.
"The consequences of Covid-19 for global oil demand will be significant," the IEA stated on Thursday. Transport and services shutdowns in China and a halt to industrial activity are expected to hit exports and the broader economy.
Brent crude, the international oil benchmark, has fallen in recent weeks from $65 a barrel in January, to under $56 on Thursday.
Incomparable with the Sars epidemic
The coronavirus outbreak has emerged as a "key downside risk" for the euro area's growth prospects, the European Commission assessed in its winter forecasts on Thursday.
The EU left its outlook for euro area growth this and next unchanged at 1.2 per cent compared with its last set of projections in 2019.
But the commission stated its outlook was based on expectation that the virus outbreak peaks in the first quarter, with "relatively limited global spillovers".
"The longer it lasts, the higher likelihood of knock-on effects on economic sentiment and global financing conditions."
Paolo Gelloni, the EU's economics commissioner, emphasised the uncertainty surrounding the outlook for the virus. He challenged parallels with economic impact of the Sars epidemic in 2003 due to the smaller degree of China's interconnectedness with the West.