IEA Reports Record-High Global Oil Demand Amid Skyrocketing … – Foreign Policy

Welcome back to World Brief, where we’re looking at record-high oil demand as OPEC+ drives costs higher; New Zealand’s battle against Chinese, Iranian, and Russian interference; and the United States’ latest aid request for Ukraine.

Welcome back to World Brief, where we’re looking at record-high oil demand as OPEC+ drives costs higher; New Zealand’s battle against Chinese, Iranian, and Russian interference; and the United States’ latest aid request for Ukraine.

Get ready for higher pump costs the next time you go to your local gas station. According to the International Energy Agency (IEA) on Friday, oil prices have increased around 20 percent since June. But don’t blame the messenger; blame skyrocketing global demand.

World oil use hit a record high of 103 million barrels a day in June and is likely to grow further in August. In fact, demand is expected to average a record-setting 102.2 million barrels a day this year. The cost of Brent crude, the international benchmark, neared $87 on Friday, up 10 percent from last month. And despite it already being the highest-traded cost for crude since January, the IEA predicted that barrel prices may touch $100 by the end of the year.

A flurry of factors contributed to this immense level of demand. Better-than-expected growth among countries in the Organization for Economic Cooperation and Development pushed consumers to buy more petrol. Summer travel also led to mass oil use, and major economies such as China saw surges in oil consumption. Indeed, 70 percent of all demand came from Beijing, with China once again expected to contribute around 60 percent of all demand next year.

This may come as a surprise to some, especially to those of you who read Wednesday’s report by China’s National Bureau of Statistics, which hinted at signs of worsening deflation driven in part by weak demand for Chinese-made goods both at home and abroad. However, the Chinese government’s stockpiling of crude and continued post-COVID-19 recovery efforts are pushing China to up its oil demand—for now.

Next year, the IEA predicted petrol consumption to slow as post-COVID-19 recovery plans end, stricter fuel efficiency standards are put in place, remote work grows, and electric vehicles become more popular. Until now, international efforts to curb carbon emissions have had little impact on overall demand.

Despite decreasing oil consumption in the near future, pump prices will remain high. In June, OPEC+ extended its limitation of crude supplies to the end of 2024 to further raise costs, even as production dropped to its lowest level since October 2021. Much of this push has been led by Saudi Arabia, the world’s largest crude oil exporter, which has slashed output by around 500,000 barrels a day in recent months. Russia’s suspension last month of the Black Sea Grain Initiative, which protected shipments out of the region, also hurt output numbers and raised fears of greater instability in the market.

Foreign interference. New Zealand’s Security Intelligence Service declassified a report on Friday detailing Chinese, Iranian, and Russian efforts to interfere in Wellington’s politics. Among the incidents reported, the most significant was the Chinese Communist Party’s attempts at targeting Chinese nationals living in the country for intelligence purposes. Tehran was accused of monitoring Iranian dissidents in New Zealand, and Moscow was linked to supply chain disruptions and espionage campaigns.

Publicly publishing the Security Intelligence Service’s findings is a new strategy for New Zealand. The agency had previously taken a more secretive approach to its work, but criticism of its overemphasis on Islamist extremism at the expense of other threats—such as the 2019 Christchurch shooting carried out by a white supremacist—has pushed the intelligence branch to share its insights more broadly.

Keep it coming. The Biden administration is asking Congress to open its purse strings to the tune of $40 billion. On Thursday, the White House requested more than $13 billion in emergency defense aid to assist Ukraine in its war against Russia as well as an additional $8 billion for humanitarian support in Kyiv. That’s on top of $12 billion for U.S. disaster relief domestically—something Hawaii’s Maui island will certainly require—and funds to strengthen migration and drug trafficking enforcement at the U.S.-Mexico border.

The last time U.S. President Joe Biden requested emergency aid for Ukraine was November 2022. Despite Republican opposition to the petition at the time, the more than $37 billion deal was passed. However, the now-drawn-out Ukrainian counteroffensive as well as a greater political divide on the Hill may make this next cash infusion a harder pitch to sell. “No, $13 billion isn’t pocket change, but it’s one-third of the $37 billion that Biden requested for Ukraine aid last November,” FP’s Jack Detsch reported in Situation Report. “And Ukraine, as is its wont, wants more.”

Pointing fingers. Six Colombian nationals were arrested on Thursday in connection to the assassination of Ecuadorian presidential candidate Fernando Villavicencio a day earlier. Villavicencio was shot while leaving a campaign event at a high school in Quito, the capital. He was the first presidential candidate to ever be killed in the Latin American country.

The suspected involvement of Colombian nationals in Villavicencio’s death has sparked memories of former Haitian President Jovenel Moïse’s assassination in July 2021: At least 18 Colombian nationals are awaiting trial in Haiti for their alleged involvement in that plot. Initial reports suspected Mexico’s Sinaloa cartel was behind Villavicencio’s attack after a local group tied to the cartel threatened him for campaigning against drug trafficking and government corruption.

An American nurse and her daughter were freed Wednesday after being kidnapped nearly two weeks ago in which country?

A. Dominican Republic
B. Haiti
C. Jamaica
D. Trinidad and Tobago

For some people, a 15-month prison sentence means 15 months. For others, such as former South African President Jacob Zuma—who was charged with defying a court order to testify on corruption allegations—it means two months in prison, then medical parole, then less than one day behind bars before being released due to overcrowding. Political opponents have accused the government of giving Zuma preferential treatment after his release on Friday. Let’s be honest; it’s not too hard to see where they’re coming from.

B. Haiti

Haiti’s gangs, which control around 80 percent of the capital city—are more than independent warlords; they’re part of how the country functions, Pierre Espérance wrote in Foreign Policy last month.

To take the rest of FP’s weekly international news quiz, click here or sign up to be alerted when a new one is published.

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Ava Grey

Hi there! I'm Ava Grey, an enthusiastic article writer with a passion for the arts, fashion, and staying informed about current events. As a journalism student at the New York Academy of Art, I'm driven to use my writing to create positive change and spark meaningful conversations. I'm particularly interested in contemporary art and sustainable fashion, and I love exploring how people use these mediums to express themselves and communicate their values. I believe that staying informed and hearing different perspectives is essential for personal growth and learning, and I'm always eager to engage in lively debates and discussions.

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