The Impact of the Corona Virus on the Global Oil and Gas Market and Its Future Prospects

Subject Areas : Energy

Ashkan Abdalisousan ¹ , Mostafa Khalatbari ² , shayesteh Ebrahimi zaker ³ , Nastaran Heidari ⁴ , Mohammad amin Tavana ⁵ , Mohammad reza Gharehdaghi ⁶

1 - Assistant Professor, Department of Engineering, Astara Branch, Islamic Azad University, Astara, Iran - Assistant Professor, Department of Energy Engineering and Economics, Tehran Science and Research Branch, Islamic Azad University,
2 - Undergraduate Student, Department of Energy Engineering and Economics, Tehran Science and Research Branch, Islamic Azad University, Tehran, Iran
3 - Undergraduate Student, Department of Energy Engineering and Economics, Tehran Science and Research Branch, Islamic Azad University, Tehran, Iran
4 - Undergraduate Student, Department of Energy Engineering and Economics, Tehran Science and Research Branch, Islamic Azad University, Tehran, Iran
5 - Undergraduate Student, Department of Energy Engineering and Economics, Tehran Science and Research Branch, Islamic Azad University, Tehran, Iran
6 - Undergraduate Student, Department of Energy Engineering and Economics, Tehran Science and Research Branch, Islamic Azad University, Tehran, Iran

Received: 2020-08-08 Accepted : 2021-06-21 Published : 2021-03-21

Keywords: Corona virus, crude oil, gas, supply, Demand,

Abstract :

The outbreak of Corona virus has led to instability in the global economy, especially in the oil and gas industry, and has boosted volatility in financial markets. The reaction to the price of oil for the virus was gradually accepted until March 9, 2020 and international prices fell by more than 20 percent in one day. Increase in the number of patients and the strengthening of financial market volatility have a long-term negative impact on the recent dynamics of crude oil and gas prices. Due to the recession in 2020 and the re-growth projected in 2021, the annual growth of global oil demand will increase. Between 2019 and 2025, global oil demand is expected to grow at an average annual rate of under 1 million barrels per day, and demand will increase by 5.7 million barrels per day over the entire period. Given the current situation, the trend of demand for oil and gas will continue to decline, which will lead to an increase in global demand for renewable energy and its replacement in the world. This article examines the effects of the spread of the virus on prices, supply, demand, exports and imports of crude oil and gas in the world and the factors that can calm this economic chaos. Its results include reducing OPEC production and preventing price failures that weaken the global economy, or maintaining sustainable production and accepting the risk of price failure. At the end, several solutions are presented for quick use of the opportunity in the crisis of the Corona outbreak and separation of the country's economy from fossil fuels and move towards clean and sustainable energy, which leads to reducing environmental pollution.