Oil: Opec forecasts unchanged global demand growth for 2023

The Organization of Petroleum Exporting Countries (Opec) expects global oil demand to rise by 2.3 million barrels per day in 2023 from a year ago to an average of 101.9 million barrels, according to the cartel’s latest monthly report, which confirms its overall forecast from last month.

The group of oil exporting countries has nevertheless revised slightly upwards the oil demand of countries outside the OECD, where it should increase by 2.2 million barrels per day (mb/d) in 2023 (against +2.1 mb/d in March), mainly driven by China and India. This slight adjustment is due to “better-than-expected improvements in economic activity in China after the abandonment of its zero COVID-19 policy, as well as further improvements expected in the Middle East, Latin America and other non-OECD European countries.”

Conversely, OECD demand has been revised downwards, and will only increase by just over 0.1 mb/d (compared to a 0.2 mb/d increase forecast in March for 2023) on average compared to last year, taking into account in particular an “anticipated decline in economic activity” in the Americas and OECD Europe.

Despite climate change, the consumption of fossil fuels responsible for climate-damaging greenhouse gas emissions continues to grow. Global oil demand is expected to average a record 101.9 million barrels per day in 2023, despite an uncertain economic outlook, according to Opec, which revises its oil supply and demand forecasts each month.

While Opec notes that the “growth momentum of the second half of 2022 is expected to continue into the first half of 2023,” the group believes that “the global economy will continue to face challenges such as high inflation, higher interest rates, particularly in the Eurozone and the U.S., and high debt levels in many regions.”

Total world oil demand averaged 99.6 mb/d in 2022, according to the latest Opec estimates, virtually unchanged from the last Opec report published in mid-March.