OPEC has reaffirmed its forecast for robust growth in global oil demand in 2024 and 2025 while also revising its economic growth projection for the current year upward, signaling optimism for the oil market’s trajectory.
According to OPEC’s monthly report, global oil demand is expected to increase by 2.25 million barrels per day (bpd) in 2024 and by 1.85 million bpd in 2025, figures that remain unchanged from the previous month.
The organization anticipates that continued economic expansion could provide further momentum to oil demand, with its economic growth forecast for 2024 slightly raised following positive trends observed towards the end of 2023.
“While some downside risks persist, a continuation of the expected momentum from the beginning of the year could result in additional upside potential for global economic growth in 2024.” OPEC said in the report.
“The 2024 and 2025 growth trajectories of India, China, as well as the United States, could exceed current expectations.”
Despite ongoing concerns about high interest rates, geopolitical tensions, and supply disruptions in the Middle East, oil prices have been supported, with Brent crude trading around $82 a barrel. OPEC attributed the recent price rise to strengthening oil market fundamentals and geopolitical factors.
OPEC’s economic outlook for 2024 is optimistic, with a projected growth rate of 2.8%, supported by expectations of easing inflation.
The forecast for 2025 remains steady at 2.9%, with OPEC expressing confidence that domestic and geopolitical developments are unlikely to significantly impact growth momentum.
However, OPEC’s projections for oil demand growth are notably higher than those of the International Energy Agency (IEA), reflecting differing views on future energy consumption trends.
While OPEC expects oil demand to continue rising over the next two decades, the IEA predicts a peak in oil demand by 2030 as the world transitions to cleaner energy sources.
