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OPEC is cautiously optimistic about China’s oil demand this year, expecting consumption growth of between 500,000 barrels per day (bpd) and 600,000 bpd in 2023 compared to 2022, OPEC’s Secretary General Haitham Al Ghais said at the CERAWeek energy conference in Houston on Tuesday.
“With China opening up, we are quite optimistic, cautiously,” Al Ghais said, as carried by Reuters.
OPEC expects global oil demand to rise by 2.3 million bpd this year, its secretary general said, reiterating an earlier OPEC forecast from the February Monthly Oil Market Report (MOMR).
In the February report, OPEC raised its world oil demand growth forecast for 2023 by 100,000 bpd, to 2.3 million bpd.
The International Energy Agency (IEA), for its part, said in its February report that global oil demand was set to increase by 2 million bpd this year, pushed up by growth in Chinese consumption after the reopening.
“China accounts for nearly half the 2 mb/d projected increase this year, with neighbouring countries also set to benefit after Beijing ditched its zero-Covid policies,” the IEA said in its Oil Market Report, expecting a “resurgent China” to see oil demand growth of 900,000 bpd.
At CERAWeek, OPEC’s Al Ghais also said he was not concerned about the rerouting of the global oil flows from Russia to the East after the EU embargoes and the G7 price caps on Russia’s crude oil and fuel exports.
The OPEC+ group comprising OPEC and non-OPEC producers led by Russia is critical for ensuring stable oil markets, Al Ghais said, when asked if the alliance is still viable.
Last month, before the rumors of the UAE considering leaving OPEC – which the emirates swiftly dismissed at the end of last week – OPEC’s Al Ghais said that the OPEC+ group deserved to be given credit for the way it had handled oil market stability in recent months.
“Due recognition should be given for our constructive and positive role in supporting global market stability including to remind ourselves that the G20 and major consumers around the world commended us for our historical actions taken since 2020,” Al Ghais told Reuters in early February.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.