OPEC Revises Down Oil Demand Growth Forecasts for 2024 and 2025.
OPEC has once again lowered its forecasts for global oil demand growth in 2024 and 2025, citing weakened demand in China, India, and other regions. This marks the fifth consecutive downward revision for the producer group, underscoring ongoing challenges in the global energy market.
In its monthly report released Wednesday, OPEC projected a rise in global oil demand of 1.61 million barrels per day (bpd) in 2024, down from the 1.82 million bpd estimate it released last month. The downgrade reflects bearish data from the third quarter, which OPEC described as the primary driver for the adjustment.
The organization also revised its 2025 demand growth forecast, reducing it to 1.45 million bpd from the previous estimate of 1.54 million bpd.
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Regional Weakness Highlights Key Challenges
OPEC identified China, the world’s largest crude importer, as a significant factor in the latest downgrade. Chinese oil demand in October reportedly contracted by 81,000 bpd year-on-year. Other Asian nations, the Middle East, and Africa also contributed to the revised outlook.
The adjustments highlight the difficulties faced by OPEC+—the coalition of OPEC members and allies like Russia—amid falling prices and uncertain economic conditions. Earlier this month, OPEC+ delayed a planned increase in oil production until April 2025, signaling the group’s cautious approach to managing market volatility.
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Market Reaction and Broader Industry Perspectives
Following the release of OPEC’s report, oil prices pared earlier gains, with Brent crude trading below $73 per barrel.
The weaker OPEC forecast contrasts with the International Energy Agency’s (IEA) lower projections for 2024. The IEA, representing industrialized countries, has forecast global oil demand growth at 920,000 bpd for 2024, far below OPEC’s outlook. The agency is set to update its figures on Thursday.
Implications for the Energy Market
The revised forecasts highlight the growing uncertainties around global oil demand, particularly as countries like China face economic slowdowns and the world accelerates its transition to cleaner energy sources.
As OPEC continues to monitor the market, the divergence in outlooks between OPEC and the IEA underscores broader industry debates about the pace of recovery and long-term energy demand trends.
