OPEC Downgrades Oil Consumption Forecasts for 2024 and 2025

The Organization of the Petroleum Exporting Countries (OPEC) remains confident that oil demand will grow in 2024 and 2025, but once again, as was the case last month, it has lowered its projections compared to the previous month, according to its latest monthly report released on Wednesday.

Global consumption is expected to reach 103.82 million barrels per day (mbd) in 2024, an increase from 102.21 million in 2023. For 2025, OPEC anticipates global consumption of 105.27 mbd. In its previous estimate in November, OPEC had forecasted consumption of 104.03 mbd and 105.57 mbd for the next two years. This slight downward adjustment in projections is a result of a "minor adjustment," specifically due to the update of data corresponding to the first, second, and third quarters of 2024, according to OPEC. The increase in demand is primarily coming from countries that are not part of the OECD. Sustained economic growth in China, fueled by activity in India and other non-OECD countries, is expected to be the key factors driving the increase in oil demand. Within the OECD countries, the American continent is expected to boost demand, with slight support from Europe, the report adds.

The reduction in OPEC's projections could be an indicator of a temporary slowdown in global economic growth, underscoring the importance of diversifying income sources and maintaining prudent financial management, especially in sectors highly dependent on commodities like oil. It is crucial to stay alert to changes in these forecasts, as they could influence investment decisions and fiscal planning for the countries involved.