The Bank of Montreal has said it expects gasoline demand to hit a record-low of US$2.60 per litre this year as supply has been tight due to the El Niño weather phenomenon.
While the central bank’s benchmark gasoline price is at US$3.70 per litres, the Bank of Nova Scotia says it expects it to reach $2.25 per litrel by the end of this year.
“We’re not expecting a significant change in the price of gasoline.
There are a number of factors at work in the U.S., but we think the key to the long-term outlook for gasoline is a healthy outlook for demand,” said Rob Porter, Bank of Toronto president and chief economist.
The Bank of England has been keeping an eye on the U, and has predicted a “slight decline” in the supply of gasoline by 2020, with a second-quarter surge likely to be the result of demand picking up, as the economic recovery continues.
However, the global economic outlook remains “fragile” and there are fears that the global economy may suffer a major downturn in the second half of next year, according to the International Monetary Fund.
This is due to a slowdown in demand from the U., a weaker global economy, and the effects of El Niño, the weather phenomenon which affects many parts of the world.
In a report released on Wednesday, the IMF also said it expected a further slowdown in global growth and a fall in the global growth rate in 2020.
Its forecast for a fall of 3 per cent in global GDP in 2020 from a year earlier, while it sees growth falling to 3.5 per cent by 2021, reflects the effects on the global labour market of El Nino, the bank said.
Meanwhile, a new global forecast by the Bank for International Settlements (BIS) forecasts that global gross domestic product will be 2.4 per cent below the peak in 2020, which was forecast by a team of economists.
(Reporting by Elizabeth Hardy; Editing by David Evans)