‎“OPEC” issues its monthly report, indicates risks about ‎declining demand

Organization of the Petroleum Exporting Countries (OPEC) on Thursday signaled the risks of lower oil demand in the summer, partly due to the surprise production target cuts announced by OPEC+ producers on April 2, although the group maintained its forecast for world oil demand in 2023.

OPEC said in a monthly report that demand will rise by 2.32 million barrels per day, or 2.3%, unchanged from last month’s forecast.

OPEC said its production in March fell by 86,000 bpd to 28.80 million bpd, reflecting the impact of previous production cuts pledged by OPEC+ to support the market as well as some unplanned outages.

The organization maintained its forecast for global economic growth in 2023 at 2.6%, amid downside risks.

Regarding the Chinese request; A monthly OPEC report revealed that Chinese oil demand will rise by 760,000 barrels in 2023, from 710,000 barrels in its previous expectations, indicating that the impact of China’s recent reopening was not enough to reverse the declining trend in oil consumption.

In a discussion about the summer market outlook, OPEC said that the usual seasonal increase in demand in the US could be affected by any economic weakness due to interest rate hikes.

OPEC said it should be noted that potential challenges to global economic development include high inflation, monetary tightening, stability of financial markets, and high levels of sovereign debt, corporate and private debt.