OPEC cuts oil demand growth forecast again

The Organization of the Petroleum Exporting Countries (OPEC) has reduced its global oil demand growth projection for 2026 to about 800,000 b/d, around 200,000 b/d lower than its previous estimate.

IMAGE: OPEC logo. Getty Images

OPEC has lowered its global oil demand forecast, marking a third consecutive downward revision as the ongoing conflict in the Middle East continues to reshape energy consumption patterns.

OPEC sees global oil demand to reach about 105.94 million b/d in 2026, including about 45.99 million b/d from OECD economies – about 20,000 b/d lower than its June projection.

OPEC has forecast oil demand from non-OECD countries to average around 59.95 million b/d this year – about 170,000 b/d lower than its previous projection. 

“Overall, oil demand in the OECD is projected to increase by about 40 tb/d [40,000 b/d] in 2026, while non-OECD oil demand is expected to grow by about 0.74 mb/d, y-o-y [740,000 b/d year-on-year],” OPEC said.

Global oil consumption in 2027 is expected to grow by 1.9 million b/d, to average 107.88 million b/d – slightly higher than OPEC’s previous projection.

OPEC sees demand for its crude to average 42.3 million b/d this year – about 200,000 b/d lower than last month’s projection. The Saudi Arabia-led coalition expects demand for its crude to reach 43.6 million b/d next year.

This adjustment reflects heightened market uncertainty and the economic strain caused by persistent geopolitical instability in the Middle East region.

Supply estimates

Total crude oil production by OPEC+ members averaged 36.28 million b/d last month, about 3 million b/d higher than in May, OPEC said.

In the UAE – a recently departed core-OPEC member – production increased by 1.6 million b/d to about 3.8 million b/d in June, OPEC said.

Kuwait and Iraq also increased oil production by 880,000 b/d and 446,000 b/d last month to about 1.5 million b/d and 2.0 million b/d, respectively.

Meanwhile, oil production in OPEC’s de-facto leader Saudi Arabia decreased by 99,000 b/d in June to 6.8 million b/d.

Russia, OPEC+’s second-largest producer, cut production by 61,000 b/d last month to about 8.9 million b/d as the country’s energy production and refining facilities continued to be targeted by Ukrainian missiles and drones.

The Vienna-headquartered coalition sees non-OPEC production to grow by 600,000 b/d, with output expected to average around 54.8 million b/d this year – matching its previous estimate.

“The main drivers of growth in liquids production are expected to be Brazil, the US, Canada, and Argentina,” it said.

The OPEC+ coalition comprise of the core 12 OPEC member countries, along with Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia and Sudan.

By Aparupa Mazumder

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