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Germany, the European Union’s largest economy, is set to see a significant drop in oil consumption for 2023 as economic output shrinks, crimping demand for industrial fuels, Bloomberg reports, citing an interview with the International Energy Agency (IEA).
With only Pakistan on track for a steeper decline worldwide, Germany is poised to lose 90,000 barrels-per-day of oil consumption, Bloomberg cited the IEA oil market analyst Ciaran Healy as saying.
“Oil product demand, which includes biofuels and direct crude burn, will fall by more in Germany than any other OECD country during 2023,” Healy told Bloomberg on Monday, adding, “Globally, we think only Pakistan will see a steeper annual decline.”Germany’s GDP fell slightly in the third-quarter, shrinking 0.1% compared to the previous quarter. At the same time, Germany's Q2 GDP has been revised to indicate 0.1% growth, while previous calculations had put it at 0%. Q1 GDP was also revised higher. Germany’s Q4 2022 GDP was down 0.4%.
According to Bloomberg, Germany’s economic output shrank in Q3 this year, with purchasing manager indexes (PMI) showing continued contractions in construction and manufacturing.
The IEA is forecasting a drop in diesel demand for Germany by some 40,000 barrels per day (a fall of around 4%) for 2023.
Some more optimistic news has come in the form of Monday inflation data, which shows inflation in Germany easing in October to its lowest level since August 2021, Reuters reports, citing the country’s federal statistics office.
Inflation in Germany for October has now pulled back to 3%, with core inflation (not including food and energy) falling to 4.3% in October, down from 4.6% in September.
Consumer prices are now more in line with the rest of the European Union.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com