OPEC Boosts Global Oil Demand Forecast

• OPEC has increased its global oil demand forecast in both the long and medium term, revising its previous forecast for 2023 higher by 1.4 million barrels per day.
• The group now sees oil demand hitting 103 million barrels per day in 2023 and rising to 108.3 million barrels per day in 2030, with OPEC market share increasing over that time.
• The combination of a more robust recovery than previously expected and a global shift toward prioritizing energy security over an energy transition will drive this demand growth.

OPEC has increased its outlook for global oil demand in the medium and longer term, the group said in its 2022 World Oil Outlook released on Monday.

OPEC said in the report that global oil demand will increase to 103 million barrels per day next year—an increase of 2.7 million bpd from 2022 and an increase of 1.4 million bpd from what the group predicted for 2023 last year.

OPEC raised its oil demand outlook for the medium term as well, through 2027, increasing the outlook by 2 million bpd by the end of that period, compared to what the group forecasted last year.

The reason for the bump in how the group sees world oil demand is the more robust recovery seen this year and next, and the shift in focus from energy transition to energy security.

OPEC now sees oil demand hitting 108.3 million bpd in 2030, also up from what it forecasted for 2030 last year. In the even longer term, OPEC sees 2045 global oil demand hitting 109.8 million bpd, up from the 108.2 million bpd that it forecasted last year.

OPEC sees its own market share rising, but sees OPEC’s output lower in 2027 than in 2022.

In its closely-watched Monthly Oil Market Report (MOMR) that was released on October 12,  OPEC revised down its estimate of global oil demand growth for 2022 by 460,000 barrels per day (bpd), citing China’s Covid lockdowns, economic headwinds in developed economies, and inflationary pressures everywhere. In that report, OPEC saw world oil demand growing by 2.6 million bpd this year to average 99.7 million bpd. The cartel also slashed its oil demand growth forecast for 2023 in that report, by 360,000 bpd, expecting growth at 2.3 million bpd next year.

OPEC+ agreed to cut production targets by 2 million bpd at its latest meeting held on October 5.

By Julianne Geiger for Oilprice.com