Even so, it will nonetheless be effectively above the annual common of the previous decade excluding the pandemic years and above predictions by the Worldwide Power Company which sees a serious slowdown in demand development subsequent yr to 860,000 bpd.
Oil demand development is a sign of probably oil market power and kinds a part of the backdrop for coverage choices by OPEC and its allies, often called OPEC+. The group in June prolonged provide curbs into 2024 to assist the market as concern about weakening demand pressured costs.
For 2024, three OPEC sources stated that whereas demand development was more likely to present a slowdown it will not be as extreme because the IEA predicts and development will probably be above 1 million bpd and sure under 2 million bpd.
“It may be anticipated that the rise in oil demand in 2024 will likely be a lot decrease than 2023,” one of many OPEC sources stated, including that it might be between 1.5 to 1.7 million bpd.
OPEC is predicted to publish its first demand forecast for 2023 in its month-to-month report on July 13.
“It will likely be extra bullish than the IEA,” one other supply stated of OPEC’s 2024 demand view.
Prime officers from OPEC international locations at a convention this week reminiscent of Amin Nasser, CEO of state-owned oil producer Saudi Aramco, expressed optimism over the oil demand outlook regardless of financial headwinds weighing on costs.
“Asia is rising. China alone between 2019 and 2023, 3 million bpd development, India 1 million bpd development, so there’s a pickup in demand,” he stated.
Oil demand forecasters typically need to make sizeable revisions given modifications within the financial outlook and geopolitical uncertainties, which this yr included China’s lifting of coronavirus lockdowns and rising rates of interest.
OPEC initially forecast demand development in 2023 of two.7 million bpd in its first forecast revealed in July 2022, later revising it all the way down to 2.35 million bpd.