OPEC keeps global oil demand growth forecast unchanged at 2.2 million b/d for 2024

Strong economic activity in China and more planes taking off around the world are among the reasons for a bouyant outlook.

PHOTO: An oil pump against OPEC's logo. Getty Images

In its February monthly oil market report (MOMR), the Organization of the Petroleum Exporting Countries (OPEC) projects global oil demand growth at 2.2 million b/d this year, largely consistent with the previous month's projection.

Oil demand in the US is expected to rise due to “improving expectation for the US economy, which will have a positive impact on oil demand.”

Oil demand in the OECD group of developed countries is expected to grow by 300,000 b/d to reach 46 million b/d in 2024, and be propped up by growth in OECD countries in the Americas.

Non-OECD oil demand is expected to increase by about 2 million b/d to reach 58.3 million b/d in 2024, driven by demand growth in China, India, the Middle East and other Asian countries.

OPEC expects total global oil demand to reach 104.4 million b/d this year on the back of “continued robust economic activity in China, global air travel recovery and expected healthy petrochemical feedstock requirements.”

The oil-producers group projects global oil demand in 2025 to grow by 1.8 million b/d, to reach 106.2 million b/d.

OPEC expects demand for its crude to be at 28.4 million b/d this year – 1 million b/d lower than last month’s assessment - before rising next year.

“Demand for OPEC crude in 2025 is expected to reach about 28.8 mb/d [28.8 million b/d], an increase of about 0.5 mb/d [500,000 b/d] over the forecast 2024 level,” it said in its flagship report.

OPEC’s secretary general Haitham Al Ghais sees global oil demand for 2024 to be robust, despite Saudi Arabia’s decision to delay oil capacity expansion plans.

Meanwhile, OPEC attributes the recent crude oil price volatility to ongoing geopolitical tensions in the Middle East and Russia-Ukraine, following attacks on oil infrastructure in the Baltic Sea and airstrikes on commercial ships in the Red Sea, which has exerted upward pressure on Brent futures.

Supply projections

The coalition expects non-OPEC liquid fuels production to grow by 1.2 million b/d this year - 100,000 b/d lower than its previous assessment.

“The main drivers for liquids supply growth in 2024 are expected to be the US, Canada, Guyana, Brazil, and Norway,” it said.

OPEC projects oil output to decline by the most in Russia, Mexico and Angola this year.

The core 12 OPEC member countries produced 26.3 million b/d of crude oil in January, marking a decrease of 350,000 b/d month-on-month.

“The share of OPEC crude oil in total global production in January, decreased by 0.2 pp [percentage point] to stand at 25.9% compared with the previous month,” it added.

By Aparupa Mazumder 

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