OIL DEMAND: SUNRISE ABOVE THE CLOUD

AGENDA

RESET & RECOVER LEARN TO SURVIVESUNRISE ON

A CLOUDY DAY

OIL DEMAND

AGENDA

RESET & RECOVER LEARN TO SURVIVESUNRISE ON

A CLOUDY DAY

OIL DEMAND

CHAPTER ONE : RESET & RECOVER

THE IMPACT OF

POST-LOCKDOWN LIFELOCKDOWNPRE-COVID

Source : World Bank

GLOBAL COVID-19 IMPACTS

POVERTY

• 88-93 MILLION PEOPLE PLUNGED INTO POVERTY IN 2020, HIGHEST SINCE THE ASIAN CRISIS IN 1998

Note: Extreme poverty = income less than $1.90 per day in 2011 prices

EMPLOYMENT

• 255 MILLION FULL-TIME EMPLOYMENT JOB LOSSES

CHAPTER ONE : RESET & RECOVER

OIL DEMAND HAS RECOVERED?World activity and mobility gradually resume, recovery in fuel demand from the bottom continues

20

30

40

50

60

70

80

90

100

80

85

90

95

100

105

1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21

2021 OIL DEMAND BY SECTORS

Power generation

Petrochemical

Transportation

60%

13%

5%

Others

Recovery Demand led by Transportation and Petrochemical

Sectors

Pre-Covid19 =

64.3 USD/BBL

Source: S&P Global Platts, IEA, EIA, OPEC

GLOBAL OIL DEMAND AND OIL PRICE

Pre-Covid19 = 100 MMBD

MMBD

Brent Price

Oil Demand

Brent Price, USD/BBL

2021 Oil Demand Growth =

96.5 MMBD (+5.5 MMBD YoY)

AGENDA

LEARN TO SURVIVESUNRISE ON

A CLOUDY DAYRESET & RECOVER

OIL DEMAND

CHAPTER TWO : LEARN TO SURVIVE

KEY DRIVERS OF OIL DEMAND

CLIMATE CHANGE

COVID-19 TOLERANCE’S POLICY

MACRO ECONOMIC POLICY

DRIVER 1: COVID-19 TOLERANCE’S POLICIESCHAPTER TWO : LEARN TO SURVIVE

0

20

40

60

80

Dec-20 Mar-21 Jun-21 Sep-21

World

U.S.

UK

% Progress in vaccinations against COVID-19

0

400

800

1200

1600

0

20

40

60

80

Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21

COVID-19 Thousand cases COVID-19 Death Rate

HIGH VACCINATION RATE BRING DOWN DEATH RATE

“Despite higher case, death rate still very low”

Herd Immunity Rate = 75%

UK COVID-19 Case and Death Rate

Healthcare development

89%50%Death Rate Death Rate

FACTORS TO WATCH : COVID-19 PILLS

Daily New COVID-19 Cases

0.0

0.2

0.4

0.6

0.8

Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21

Global

US

EU

Asia

Mil. cases

“European Covid cases surge, more rules for unvaccinated people and PARTIAL lockdowns instead”

DRIVER 1: COVID-19 TOLERANCE’S POLICIESCHAPTER TWO : LEARN TO SURVIVE

U.S.

20%

China

14%

EU13%M/E

9%

LATAM8%

SEA7%

CHINA IS THE 2ND TOP OIL

DEMAND COUNTRY

OIL DEMAND BY COUNTRIES

• China’s vaccination rate = 77 %

• China not yet reopen country

LIVING WITH COVID-19 ZERO COVID-19 STRATEGY

COVID-19 TOLERANCE’S POLICIES

CHAPTER TWO : LEARN TO SURVIVE

19 Jul’ 2021

REOPEN COUNTRY DATE

UK

Thailand

1 Nov’ 2021

U.S.

8 Nov’ 2021

Source: IATA

Gradual reopening to raise flight movement

DRIVER 1 : COVID-19 TOLERANCE’S POLICIES

18%22%23%

12%

65%

23%

Europe-N.America Asia-Europe

2020 2021E 2022F

Note : RPKs (Revenue Passenger Kilometers)

Uneven recovery in international travel in 2022

MAIN INTERNATIONAL ROUTES (RPKs % OF 2019 LEVELS)

DRIVER 2 : MACRO ECONOMIC POLICIES

Stimulus package (% of GDP)

CHAPTER TWO : LEARN TO SURVIVE

54

35

26

5

Stimulus package as an economic growth driver

As of May 21

American Rescue Plan

: COVID-19 RELIEF MEASURES

U.S. FISCAL PACKAGE

$1.9 Trillion

Next Generation EU 2021-2023

€806.9 billion

EU RECOVERY FUNDS

JAPAN STIMULUS PACKAGE

Additional Economic Stimulus Package

$488 Billion

$3.5 Trillion• INFRASTRUCTURE BILLS• LEGISLATION TO STRENGTHEN THE SOCIAL SAFETY

: HEALTHCARE SYSTEM IMPROVEMENT

Budget Plan

: COVID-19 RELIEF MEASURES

Near-Term Recovery Continues while the Pandemic Resurges

WORLD ECONOMY IS RETURNING TO PRE-PANDEMIC LEVELCHAPTER TWO : LEARN TO SURVIVE

2020 2021 2022

-6.3

5 4.3Series 2 Series 3 Series 4

-0.8

7.2

6.3

Series 2 Series 3 Series 4

-3.4

65.2

Sources: IMF

-3.1

5.94.9

GDP GROWTH WORLD GDP GROWTH

6.2%

Jan-20 Jul-20 Jan-21 Jul-21

Consumer Price Index (CPI) YoY

Central bank target of 2% Europe

U.S.

Key Risk for Growth…..

CHAPTER TWO : LEARN TO SURVIVE

DRIVER 3 : CLIMATE CHANGE Environmental concerns hiked extra energy demand

IMPACT OF CLIMATE CHANGE

Cold Snap Texas Freeze Drought

Brazil’s worst drought in over 90 years

Highest heating demand in 40 years

Highest gas demand since 1997

South Korea

Texas, US Brazil

INCREASE RENEWABLE ENERGY USAGE

Electricity

usage in

2019

Gas and Coal

Solar and Wind

EU

39.5%

42.8%

• HIGH DEPENDENCE ON SOLAR AND WIND

• LOW WIND POWER GENERATION IN 2021

ENERGY POLICY: EU’S RENEWABLE PLAN

Source: Europa

ENERGY POLICY: CHINA’S DUAL CONTROL

CARBON NEUTRAL BY 2060

COAL: >60%

CHINA’S ENERGY CONSUMPTION

• HIGH DEPENDENCE ON COAL

• LESS THAN 20% FROM RENEWABLE ENERGY

• LIMIT COAL USAGE

• LACK OF POWER ENERGY

Source: EIA

CHAPTER TWO : LEARN TO SURVIVE

DRIVER 3 : CLIMATE CHANGE

Energy Prices

SHIFTING DEMAND FROM GAS TO OIL AROUND 0.5-0.8 MMBD DURING Q4’21 TO Q1’22

Source: S&P Global Platts, Reuters

$/MMBTU

0

10

20

30

40

50

60

Dec-19 Jun-20 Dec-20 Jun-21 Dec-21

LNG +446 %

(JAPAN)

LPG +85 %

Coal +209 %

Crude Oil +31%

93.594.5

96.5

98.3 98.0 98.3

0.50.3

0.30.4

92

93

94

95

96

97

98

99

100

1Q21 2Q21 3Q21 4Q21 1Q22 2Q22

Global Oil Demand (Unit : MMBD)

Power generation

Heating

OIL DEMAND:

SUNRISE ON A CLOUDY DAY

AGENDA

OIL DEMAND GROWTHCHAPTER THREE : SUNRISE ON A CLOUDY DAY

IMPROVED VACCINATION RATE & THERAPIES

INCREASING INTERNATIONAL TRAVEL & MOBILITY

LIVING WITH THE COVID-19 PANDEMIC

EXTREME WEATHER HIKES ENERGY DEMAND

Sources: IEA, EIA, OPEC, PRISM Estimated

2022 GLOBAL OIL DEMAND GROWTH + 3 MMBD YoYStrong GDP growth at 4.9% YoY

CHAPTER THREE : SUNRISE ON A CLOUDY DAY

KEY UNCERTAINTIES

Breakthrough Covid-19 Cure

Unsustainable Economic

Recovery From High Inflation

New Covid-19 Variants

& Lock Down

Higher-than-expected

Pent Up Traveling Demand

UPSIDE DOWNSIDE

OIL DEMAND: SUNRISE ABOVE THE CLOUD