IEA cuts global oil demand growth forecast for 2024

The Paris-based energy agency expects global oil demand growth to drop significantly from 2.3 million b/d in 2023 to 960,000 b/d this year, about 100,000 b/d lower than its last month’s projection.

PHOTO: Black oil barrels. Getty Images

The International Energy Agency (IEA) sees oil demand growth to be around 1 million b/d in 2025. “Subpar growth of 1 mb/d [1 million b/d] in 2025 is held back by a muted economy and accelerating clean energy technology deployment,” the energy agency said.

The forecast reveals a huge disparity between the demand outlooks of the IEA and the oil producer group OPEC for both this year and 2025. According to OPEC's latest report, global oil demand is projected to grow by 2.2 million b/d this year and 1.8 million b/d in 2025.

Onshore oil stocks surged by 83.5 million bbls in May after eight months of consecutive draws, the energy agency estimated in its monthly Oil Market Report (OMR). Oil on water plunged by 64.2 million bbls during the same time, following an increase of 112.6 million bbls in March and April, it noted.

Supply forecast

Global oil supply moved 520,000 b/d higher in May to 102.5 million b/d, the IEA estimated. For the entire year, the agency expects global oil output to grow by 690,000 b/d, primarily driven by non-OPEC producers such as the US, Guyana, Brazil, and Canada, which are leading in production.

OPEC+ supply is projected to fall by 740,000 b/d, provided supply cuts continue through the third quarter of this year.

In 2025, global oil supply is forecast to gain 1.8 million b/d, as non-OPEC+ output rises.

“With oil demand expected to remain weak, supplies may have to be adjusted lower next year, rather than higher,” the IEA said.

By Aparupa Mazumder 

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