By The Organization of the Petroleum Exporting Countries scaled down forecasts for growth in global oil demand for 2024 and 2025 on Tuesday for the fourth consecutive month.
The forecast was revised down further this month as the cartel had to make downward revisions to data from the first three quarters of this year for China, India, and other countries in Asia, Africa, and Eurasia, according to the November Oil Market Report.
OPEC revised its forecasts for growth in global demand amid concerns over oversupply in the market in the coming months.
Global demand for crude oil also remained low as top importer, China, continued to import less crude in October from a year-ago level.
In October, OPEC’s crude oil production rose, while the output of the cartel’s 10 allies fell, according to the secondary sources in the report.
OPEC trims demand forecasts
OPEC cut forecasts for growth in global oil demand in 2024 by 107,000 barrels per day on Tuesday.
It now sees demand growing by 1.8 million barrels per day this year on average.
The cartel said in the report:
Total world oil demand is anticipated to reach 104.0 mb/d in 2024, bolstered by strong transportation fuel demand and ongoing healthy economic growth, particularly in a number of non-OECD countries.
For 2025, the cartel revised its forecast for growth in global oil demand by 103,000 barrels per day from the previous month’s assessment. It sees demand increasing by a further 1.5 million barrels per day next year.
Most of the demand growth will be concentrated in the countries outside of the Organization for Economic Cooperation and Development alliance. In non-OECD countries, demand is expected to rise by 1.4 million barrels per day next year.
In OECD countries, oil demand is expected to rise by just 100,000 barrels per day on a year-on-year basis.
“Oil demand in the non-OECD is forecast to be mostly driven by requirements from China, supported by the Middle East, India, Other Asia and Latin America,” OPEC said.
“Growth is expected to be bolstered by strong air travel demand and healthy road mobility, including on-road diesel and trucking, as well as healthy industrial, construction, and agricultural activities in non-OECD countries.”
Non-OPEC supply growth
The cartel kept its forecasts for growth in oil supply from countries outside of the OPEC+ alliance unchanged from last month’s assessments.
OPEC expects growth in supply from countries outside the alliance to grow by 1.2 million barrels per day in 2024.
For next year, oil supply from non-OPEC countries is expected to expand further by 1.1 million barrels per day on a year-on-year basis.
OPEC noted:
Growth is anticipated to be mainly driven by the US, Brazil, Canada, and Norway.
The US production remained near record levels in the week ended November 1, data from the US Energy Information Administration showed.
Production during the reporting week was 13.5 million barrels per day in the country.
OPEC’s October production rises
OPEC’s permanent members produced 26.54 million barrels per day of oil last month, up 466,000 barrels per day, the data showed.
Production rose the most in Libya as a political dispute in the country was resolved. Production rose 556,000 barrels per day per month to 1.10 million barrels per day in October.
Saudi Arabia, the de facto leader of the group, produced 8.97 million barrels per day of crude oil last month, largely steady from the previous month.
Among the allies, Kazakhstan’s production fell by 292,000 barrels per day in October to stand at 1.29 million barrels per day, the data showed.
The OPEC+ alliance produced about 40.34 million barrels per day of crude oil in October, up 215,000 barrels per day from the previous month.
Meanwhile, OPEC+ last week agreed to extend its voluntary production cuts of 2.2 million barrels per day by another month till the end of December.
The decision was taken to provide support to oil, as prices have remained weak around the $70 per barrel mark.
Concerns that more crude oil would flood the market also weighed on sentiments.
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