‎“OPEC” expects 2.2% demand growth in 2024, despite ‎challenges

Organization of the Petroleum Exporting Countries (OPEC) on Thursday raised its forecast for global oil demand growth in 2023, but expected only a slight slowdown next year despite economic challenges, with China and India continuing to lead growth in fuel use.

According to Reuters, OPEC said in its monthly report that it expects global oil demand to grow by 2.25 million barrels per day, or 2.2%, in 2024, down from growth of 2.44 million barrels per day in 2023.

OPEC’s forecast for demand growth in 2024 is greater than that of the International Energy Agency, another closely watched forecasting agency, which updated its outlook earlier Thursday.

Oil added to previous gains after the release of the OPEC report, as Brent crude exceeded $80

The growth in oil demand is an indicator that suggests the strength of the oil market, and also draws part of the background for the decisions of the OPEC + alliance, which includes OPEC and allies. In June, the coalition extended supply restrictions to 2024 to support the market

OPEC said in the report that the factors of OPEC +’s proactive approach and production cuts added a great deal of stability to the global oil market, “which is expected to lead to the continuation of the strong oil market fundamentals seen this year in 2024.”

“In 2024, strong global economic growth amid continuous improvement in China is expected to lead to an increase in oil consumption,” she added.

The organization raised its forecast for demand growth in 2023 by 90,000 bpd from last month’s report. OPEC sources said last week that the group is sticking to an optimistic outlook for demand in 2024 and expects more growth than expected by the International Energy Agency.

The report also showed that OPEC production rose by 91,000 bpd in June to 28.19 million bpd, led by Iran and Iraq. Iran is a member of OPEC, but it is excluded from the production cut.