The events of the last few months have proven how difficult it can be to forecast in this environment, which has led us to consider a number of recovery scenarios for gasoil/diesel demand (see Middle of the Barrel – Issue 5).

  • Whilst our base case is currently on the bullish end of the spectrum, there may yet be cause to consider an upside scenario to diesel demand recovery.
  • Given the unprecedented level of fiscal and policy support flooding economies currently, any positive surprises in terms of the speed and extent to which current restrictions on economic activity can be rolled back could allow demand to surprise to the upside, returning to 2019 levels through the end of 2020.
  • On the flip side, the need for coronavirus containment over the summer months or further lockdowns come winter would delay any return to 2019 levels as economic damage becomes more difficult to reverse and the recovery flattens.