OPEC forecasts robust oil demand in 2024

The Organization of the Petroleum Exporting Countries on Thursday said it saw prospects for a healthy oil market in the second half of the year and stuck to its forecast for robust oil demand in 2024 as the outlook for world economic growth slightly improves.

The oil producer group’s upbeat view comes as global oil prices have reached the highest since January. Tight supply has given impetus to the rally and OPEC’s monthly report also showed Saudi Arabia delivered on a voluntary output cut in July.

The OPEC said it expects world oil demand to rise by 2.25 million barrels per day in 2024, compared with growth of 2.44 million bpd in 2023. Both forecasts were unchanged from last month.

“In 2024, solid global economic growth amid continued improvements in China is expected to boost the consumption of oil,” OPEC said in the report.

“Prospects for healthy oil fundamentals in the second half of the year, along with the pre-emptive, proactive and precautious approach of OPEC and non-OPEC producing countries to assess market conditions and take necessary measures at any time and as needed, will ensure stability of the global oil market.”

OPEC and its allies, together known as OPEC+, began limiting supplies in late 2022 to bolster the market and in June extended supply curbs into 2024. Tighter supply has underpinned a rally in oil prices, with Brent crude trading above $88 a barrel on Thursday, its highest since January.

The report also showed OPEC’s oil production fell sharply in July, driven by Saudi Arabia’s pledge to cut its output by 1 million bpd, a measure it has since extended to include September.