OPEC expects strong oil demand growth in 2024, 2025

The Organization of the Petroleum Exporting Countries expects strong growth in global oil demand in 2024 and 2025 driven by robust economic activities in China.

In its latest monthly report, the oil producers’ group said world oil demand will rise by 2.25 million barrels per day in 2024 and by 1.85 million bpd in 2025, a forecast which is unchanged from last month.

“Continued robust economic activity in China, global air travel recovery and expected healthy petrochemical feedstock requirements will be key for oil demand growth in 2024,” OPEC said in the report.

It added: “However, inflation levels, monetary tightening measures and sovereign debt levels could weigh on global oil demand prospects in the current year.”

However, OPEC’s forecast contradicts the projection of the International Energy Agency, which expects oil demand to decrease to 1.2 million bpd in 2024.

According to OPEC, ongoing improvements in airline activities, combined with robust road mobility are expected to support the demand for jet oil, kerosene and gasoline in 2024 among 38 member countries in the Organisation for Economic Co-operation and Development.

The report revealed that oil demand grew by a considerable 2.5 million bpd in 2023, driven by solid economic activity in non-OECD countries, led by a strong rebound from COVID-19-related lockdowns in China.

The report further pointed out that gasoline consumption is expected to exceed pre-pandemic levels in 2024.

However, the demand for jet fuel is projected to average just below the pre-pandemic levels this year.

OPEC added that non-OPEC liquids production in 2024 is expected to grow by 1.2 million bpd, revised down from the previous month’s assessment.

“The main drivers for liquids supply growth in 2024 are expected to be the US, Canada, Guyana, Brazil and Norway. The forecast for non-OPEC liquids supply growth in 2025 stands at 1.3 million bpd, unchanged from the previous month, mainly driven by the US, Brazil, Canada, Norway, Kazakhstan and Guyana,” according to the report.

OPEC noted that the world economy will grow by 2.7 percent in 2024 and 2.9 percent in 2025.