World oil demand is expected to decline by the largest volume in history in the first quarter.

World oil demand will decline by the largest volume in history in the first quarter, even exceeding the declines during the 2009 financial crisis.

That’s what IHS Markit expects, according to a new industry note, which was penned by the company’s vice presidents Jim Burkhard and Dan Evans, and its executive director Das Premasish.

“Owing to the unprecedented stoppage of Chinese economic activity in February and the spread of the coronavirus disease 2019 (COVID-19) outside of China, we estimate that world oil demand in first quarter 2020 will be 3.8 million barrels per day (MMbpd) lower than a year earlier,” the note stated.

“This represents a downward revision of 4.5 MMbpd from previous estimates prior to COVID-19,” the note added.

A quarterly drop like this has never been recorded, according to IHS Markit’s note, which outlined that the previous largest decline was in 2009, “when oil demand fell 3.6 MMbpd in the first quarter”.

Most of the demand decline is in China, although demand elsewhere, including Europe, Japan, South Korea, the Middle East, and North America, has also been revised down, the note highlighted.

Last month, Rystad Energy revealed that it had slashed its global oil demand growth forecast for 2020 by 25 percent after assessing the impact of the coronavirus.

As of February 11, the company saw demand growing by 820,000 barrels per day this year, compared to its previous forecast of 1.1 MMbpd, which was published in December before the virus outbreak. Rystad warned at the time, however, that the virus’ impact on demand could be even bigger.

On February 19, a research note from Standard Chartered outlined that global oil demand growth will drop to 0.44 MMbpd this year but rebound to 2.34 MMbpd in 2021.

Following the outbreak of the coronavirus, several companies have cut their 2020 Brent oil price forecasts. A number of oil and gas events have also been cancelled or postponed.

The World Health Organization’s website outlines that the outbreak of COVID-19 was first reported from Wuhan, China, on December 31, 2019.

To contact the author, email andreas.exarheas@rigzone.com