• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 11 days Does Toyota Know Something That We Don’t?
  • 4 days America should go after China but it should be done in a wise way.
  • 14 hours "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)
  • 10 days World could get rid of Putin and Russia but nobody is bold enough
  • 12 days China is using Chinese Names of Cities on their Border with Russia.
  • 3 hours How Far Have We Really Gotten With Alternative Energy
  • 15 hours The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 2 days Even Shell Agrees with Climate Change!
  • 3 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 12 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
BofA: Oil Demand Growth Has Peaked

BofA: Oil Demand Growth Has Peaked

Global oil demand continues to…

Venezuela’s Oil Output Could See Moderate Boost

Venezuela’s Oil Output Could See Moderate Boost

The unlikely return of full…

Felicity Bradstock

Felicity Bradstock

Felicity Bradstock is a freelance writer specialising in Energy and Finance. She has a Master’s in International Development from the University of Birmingham, UK.

More Info

Premium Content

Optimism Grows Over Oil Demand Recovery

OPEC and partners are betting on a significant boost in oil demand over the coming months as member states get ready to ramp up oil production.  OPEC, Russia, and their allies are planning to increase oil production by 2.1 million bpd by as early as July this year, suggesting the confidence they have in a market rebound. The organization’s output cuts of 7 million will be eased significantly each month between now and July. 

Saudi Arabia is also expected to ease its voluntary output cuts to increase production by 1 million bpd by July. 

The announcement to ease restrictions comes unexpectedly as the oil industry is once again suffering from increased Covid-19 restrictions as Europe and parts of Latin America go into a third wave of the pandemic. 

Oil prices have dropped to the lowest in almost two weeks as European lockdown measures continue to be extended, leaving the market unsure of upcoming demand trends. Futures in New York fell 4.6 percent on Monday, from $64.86 a barrel on April 1 to $62.15, which decreased oil prices to below the U.S. crude’s 50-day moving average.

OPEC will be hoping that prices remain generally high as production increases, relying on the international market to soak up the higher crude production by the summer months. However, it will be battling with restrictions on travel, closed businesses, and the new working-from-home norm.  Related: Iran’s Comeback To Oil Markets Unlikely To Cause Price Crash

However, optimism around the vaccine rollout continues, as the U.K. has given the first vaccine to almost half of the population, and the U.S. to over 30 percent of the population. While vaccination programs in the rest of Europe and North America are moving at a slower rate, there is still hope that many countries will catch up by late 2021. 

Vitol, the world's biggest independent oil trader, stated this week that it expects oil demand to increase over the next decade but warns jet fuel recovery will be slower. While certain oil sectors will remain stagnant, others are expected to increase, including light ends used in manufacturing. 

Platts Analytics is also optimistic about the 2021 rebound, anticipating an oil demand growth of 5.9 million bpd this year, in comparison to the 9 million bpd decrease experienced in 2020. The firm expects demand to climb steadily before plateauing at an estimated 113.5 million bpd in the late 2030s.

The increase in demand will come predominantly from Asia, as China and India’s energy needs are steadily increasing as already developed markets, such as Europe and North America, are expected to stagnate.  

OPEC+ is looking increasingly toward India and its oil refiners, as Saudi Arabia hopes to forge strategic relations with one of the fastest-growing downstream markets in the world. At present, the Arab Gulf States account for around 20 percent of India’s total import bill, which is dominated by oil and gas. 

While Covid-19 restrictions continue to hamper oil demand, optimism around the vaccine rollout as well as increased demand from emerging markets suggests OPEC’s plan to ramp up production will be met with enthusiasm. 


By Felicity Bradstock for Oilprice.com

More Top Reads From Oilprice.com:

Download The Free Oilprice App Today

Back to homepage

Leave a comment
  • Mamdouh Salameh on April 07 2021 said:
    The optimism is justified. The International Monetary Fund (IMF) is now projecting that the global economy will grow by 6% this year almost double the 3.1% growth in 2019 and 4.4% in 2022. The IMF is also projecting that China’s economy will grow by 8.1 this year. Meanwhile, the United States’ economy is showing signs of growth as well.

    Only the lockdown measures re-introduced recently in the European Union (EU) are now standing in the way of crude oil prices resuming their impressive surge. However, hopes are rising that the rollout of vaccines in the EU will soon gain momentum.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London
  • George Doolittle on April 07 2021 said:
    There is no doubt the USA still imports an awesome amount of energy product from Canada to include not just WCS but all assorted refined product as well. At some point this should result in a veritable tsunami of exports from about the St. Lawrence Seaway but so far the near totality of this product *and all the other things* seems trapped deep inside the Upper Midwest and Central United States.

    Refining margins are still amazing in the USA "Lower 48" no doubt as well with obviously a glut of all product in this massive geographical space as well.

    Maybe the various Ports of Florida and of course the Port of New York represent places where the global flood of this energy product could begin the reach where actual demand meets physical US Dollars. At the moment that would be a very, very, very low price for even upwards of one million barrels of product per day for offtake should be noted as the USA overwhelmingly runs on natural gas now to power everything.

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News