Global oil demand growth is expected at 2.5 million barrels per day (bpd) this year and 2.2 million bpd next year, OPEC said on Tuesday, leaving the previous month’s estimates unchanged, on hopes of easing of Covid curbs in China.
World oil demand growth in 2022 is expected to remain at 2.5 million bpd, with total demand averaging 99.6 million bpd, the same as last month’s assessment, OPEC said in its closely-watched Monthly Oil Market Report (MOMR) today.
“Renewed lockdowns in China weighed heavily on oil demand, with the country registering an oil demand contraction in 2022,” OPEC said.
But next year, “a resolution of the geopolitical conflict in Eastern Europe and a relaxation of China’s zero-COVID policy could provide some upside potential,” the cartel said in its outlook for 2023.
Global oil demand growth next year is expected to rise by 2.2 million bpd for an average of 101.8 million bpd, supported by expected geopolitical improvements and the containment of Covid in China.
OPEC cautioned, however, that the current unchanged outlook from last month “assumes the successful containment of COVID-19 and a resumption of pre-pandemic economic growth in China, while India’s oil demand is projected to be supported by continued healthy economic growth.”
“As the year 2022 draws to a close, the recent global economic growth slowdown with all its far-reaching implications is becoming quite evident. The year 2023 is expected to remain surrounded by many uncertainties, mandating vigilance and caution,” the cartel warned.
In supply, OPEC’s outlook for non-OPEC liquids production growth remains largely unchanged and is expected at 1.5 million bpd in 2023, led by the United States, Norway, Brazil, Canada, Kazakhstan, and Guyana, while oil production is forecast to decline mainly in Russia and Mexico.
“Nonetheless, large uncertainties persist around geopolitical development in Eastern Europe, as well as the US shale output potential next year,” OPEC said.