May 16, 2016 [OPIS] - European oil demand is stagnating after a warm winter in the first quarter coupled with the fading impact of low prices halted the growth seen last year, according to OPEC's monthly report Friday.
Downside risks to demand are also multiplying from the debt pile weighing on several countries, high taxes in the transportation sector, and rising sales of hybrid or electric cars.
European oil demand is expected to grow just 10,000 b/d this year compared to 260,000 b/d last year, the OPEC analysts estimate.
Demand fell 120,000 b/d in the big four countries of Germany, France, Italy and the U.K. in March from a year earlier, the report notes.
Diesel and gasoil demand fell the most amid the warm winter, down 101,000 b/d to a total of 3.1 million b/d.
Jet and kerosene demand fell 31,000 b/d in the big four to 702,000 b/d.
But there were gains in liquefied petroleum gas, up 69,000 b/d year-on-year to 505,000 b/d, and gasoline, up 18,000 b/d to 1.055 million b/d.
Overall, oil demand in the big four economies fell to 6.919 million b/d in March, down from 7 million b/d a year earlier.
OPEC’s worldview was little changed in the May report.
Global oil demand is expected to grow 1.2 million b/d this year, while non-OPEC supply is expected to contract 740,000 b/d.