OPEC Calculation: Oil Demand Forecasts Lowered Again

The Organization of the Petroleum Exporting Countries (OPEC) has reduced its forecasts for oil demand growth this year and next year for the third consecutive time. The reason for this is a slower increase in global fuel consumption than initially assumed. In OPEC's latest monthly report, global oil consumption is expected to increase by 1.9 million barrels per day in 2024, which corresponds to about two percent. This is a reduction of 106,000 barrels per day compared to previous forecasts. This adjustment is mainly based on actual data and slightly lowered expectations in some regions, according to OPEC. Despite the adjustments, OPEC remains more optimistic with its demand estimates than many banks and trading firms on Wall Street. The cautiously optimistic forecasts align with the highest expectations of the Saudi oil company Aramco and exceed the growth rate projected by the International Energy Agency. However, OPEC member countries show uncertainties and delay their plans to resume halted crude oil production. The alliance led by Saudi Arabia plans to gradually increase production by a total of 2.2 million barrels per day in monthly steps starting from December — albeit two months later than originally planned. Despite the uncertainties, political conflicts in the Middle East have driven up crude oil prices, which are currently around USD 77 per barrel. Nevertheless, the prices are too low for some OPEC countries, undermining their efforts to stabilize prices. Particularly Iraq, Kazakhstan, and Russia have not adhered to their promised production cuts. The report shows that the Iraqi government reduced its production by 155,000 barrels per day to 4.112 million in September, but it still remains above the agreed quota. Kazakhstan's production increased by 75,000 barrels daily despite a performance commitment. Russia decreased production by 28,000 barrels, but it still exceeded the agreed limit. OPEC+ will soon decide on the planned production increase in December. On December 1, the alliance plans to discuss its production policy for the year 2025.