OPEC: Global demand for oil will rise by 2.25 million barrels per day in 2024 (European)

The Organization of the Petroleum Exporting Countries (OPEC) on Tuesday stuck to its expectations for relatively strong growth in global oil demand in 2024 and 2025, and raised its forecasts for economic growth in both years, saying that there are possibilities for further rise.

OPEC said in a monthly report that global demand for oil will rise by 2.25 million barrels per day in 2024 and 1.85 million barrels per day in 2025.

Forecasts for both years are unchanged from those issued in last month's report.

The organization expected the "positive trend" of economic growth to extend until the first half of 2024, and raised its forecast for economic growth in 2024 and 2025 by 0.1 percentage points.

OPEC said in the report, “Global economic growth remains strong, and the potential for further upside can be achieved in all major OECD and non-OECD economies.”

The organization's report also stated that its oil production decreased by 350,000 barrels per day last January with the entry into force of a new package of voluntary production cuts adopted by the OPEC+ alliance in the first quarter.

Al-Ghais stressed that Saudi Arabia’s decision to postpone plans to expand production capacity should not be interpreted as an indication of declining demand (Reuters)

Oil prices - which currently stand at about $82 per barrel - have been affected by factors such as conflicts in the Middle East, supply disruptions, and concerns about rising interest rates.

OPEC attributed the recent rise in prices to easing speculative selling pressures, supply disruptions, and strong oil market fundamentals.

Strong expectations

Meanwhile, OPEC Secretary-General Haitham Al-Ghais stressed that the organization’s expectations regarding demand are strong, and said, “We currently believe that our estimates are correct and very strong.”

OPEC's annual forecasts published last October indicated that global demand for oil would reach 116 million barrels per day by 2045, with growth led by China, India, other Asian countries, Africa and the Middle East.

Al-Ghais expected more demand for oil in the long term, stressing the importance of OPEC's role in ensuring market stability through its flexible approach to reducing production.

Regarding the Kingdom of Saudi Arabia’s decision to postpone plans to expand oil production capacity, Al-Ghais explained that it should not be interpreted as a sign of declining demand.

“I cannot comment on a Saudi decision, but in no way can this be misinterpreted as a view that demand is declining,” he said.

On January 30, the Saudi government directed the state oil company (Aramco) to target a maximum sustainable production capacity of 12 million barrels per day, that is, one million barrels per day less than the goal announced in 2020, which was supposed to be reached in 2027.

Angola withdrawal

Al-Ghais also expressed his lack of concern about Angola’s exit from OPEC, noting that it is not the first time that a member has left the organization.

He stressed the group's flexibility, considering that the voluntary production cuts reflect the sovereign decisions taken by countries to adjust their production.

Al-Ghais said Angola is welcome to join again if it wishes to do so in the future.

Angola said on December 21 that it would withdraw from OPEC, while some analysts considered that this withdrawal raised questions about the unity of OPEC and the broader OPEC+ alliance.

Source: Al Jazeera + Reuters