The recent turmoil in oil markets and the continued spread of the coronavirus have driven oil price forecasts and oil demand growth outlook for 2020 lower. According to revised estimates by Barclays, UK Brent oil is expected to average at around $43 per barrel while US WTI oil price could remain at around $40 this year.

Earlier last month, the bank had forecast prices of UK oil and US oil to average around $59 and $54 per barrel respectively. The ongoing price was between Saudi Arabia and Russia could lead to a glut in oil supply in global markets, even as demand is expected to remain subdued due to the coronavirus outbreak.

Meanwhile, the International Energy Agency (IEA) also revised its global oil demand outlook for 2020 lower on Monday, forecasting a contraction in oil demand for the first time in over a decade. According to the IEA, oil demand is expected to fall to 99.9 million bpd, nearly 1 million bpd lower than its previous estimates.

In the medium-term, failure to contain the spread of the coronavirus worldwide could cause oil consumption to decline by as much as 730k bpd in the worst-case scenario. Industrial activity has slowed down while travel restrictions have reduced the demand for oil globally even as consumer consumption weakens across China, Asia and other parts of the world.