A record El Niño leaves a lasting dent in fuel demand

A very strong El Niño is on course to break records. The US National Oceanic and Atmospheric Administration (NOAA) puts the chance of a historic event, one. The analysis converts past El Niño GDP per capita gaps into demand losses using income elasticities by product and region. We find that El Niño could cut gasoline, diesel and jet fuel demand by about 350,000 b/d by 2029. That is only 0.3% of global demand, but it is unevenly spread: road transport takes more than three-quarters, Ecuador and Peru lose the most in share and the United States the most in volume. The analysis also explains why short-term gains in diesel and power fuels fade. Results cover North America, Asia Pacific, Latin America and Africa.