OPEC’s forecast for 2024 will likely be lower than the growth it expects to this year of 2.35 million barrels per day, or 2.4%, an abnormally high rate as the world moved out of the coronavirus pandemic.
Even so, it would still be well above the annual average of the past decade with the exception of the pandemic years and above predictions by the International Energy Agency which sees a major slowdown in demand growth next year to 860,000 bpd.
OPEC and the IEA have repeatedly clashed in recent years with OPEC criticizing the IEA, which advises industrialised countries, for what it sees as irresponsible predictions and subsequent data revisions.
Oil demand growth is an indication of likely oil market strength and forms part of the backdrop for policy decisions by OPEC and its allies, known as OPEC+. The group in June extended supply curbs into 2024 to support the market as concern of weakening demand pressured prices.
For 2024, three OPEC sources said that while demand growth was likely to show a slowdown it would not be as severe as the IEA predicts and growth will likely be above 1 million bpd and likely below 2 million bpd.
“It can be expected that the increase in oil demand in 2024 will be much lower than 2023,” one of the OPEC sources said, adding that it could be between 1.5 to 1.7 million bpd.
OPEC is expected to publish its first demand forecast for 2024 in its monthly report on July 13.
“It will be more bullish than the IEA,” another source said of OPEC’s 2024 demand view.
Top officials from OPEC countries at a conference this week such as Amin Nasser, chief executive of state-owned oil producer Saudi Aramco, expressed optimism over the oil demand outlook despite economic headwinds weighing on prices.
“Asia is growing. China alone between 2019 and 2023, 3 million bpd growth, India 1 million bpd growth, so there is a pickup in demand,” he said.
Oil demand forecasters often have to make sizeable revisions given changes in the economic outlook and geopolitical uncertainties, which this year included China’s lifting of coronavirus lockdowns and rising interest rates.
OPEC originally forecast demand growth in 2023 of 2.7 million bpd in its first forecast published in July 2022, later revising it down to 2.35 million bpd.
(This story has been corrected to fix the date in paragraph 8)
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