Opec It cut its 2022 global oil demand growth forecast for the third time since April, citing the economic impact of Russia's invasion of Ukraine, high inflation and efforts to contain the coronavirus pandemic.
The opinion of the Organization of the Petroleum Exporting Countries contrasts with that of theInternational Energy Agency (IEA), the consultant for industrialized countries, which instead raised its prospects for demand growth for 2022 on Thursday.
For 2022, the growth in demand has been revised to 260.000 barrels per day less
In its monthly report, OPEC said it expected oil demand to increase by 2022 million barrels per day (bpd), or 3,1%, by 3,2, which represents a decrease of 260.000 bpd (barrels per day) compared to the previous forecast. the IEA instead it raised its forecast by 380.000 bpd to 2,1 million bpd.
Oil consumption has rebounded from pandemic lows and is set to surpass 2019 levels this year. However, the same high prices and persistent outbreaks of coronavirus in China have led OPEC to reduce its growth projections for 2022.
"I global oil markets continued their strong recovery from the pandemic period for most of the first half of 2022, but signs have now emerged of a slowdown in global economic growth and oil demand,” OPEC says in its report.
OPEC has reduced its forecasts by global economic growth for 2022 to 3,1% from 3,5% and next year to 3,1%, saying the prospect of further weakness remained. “This is, however, still solid growth, when compared to pre-pandemic growth levels,” OPEC said. “Therefore, it stands to reason that significant downside risk prevails.”
OPEC has ramped up production after record cuts
OPEC and its allies, including Russia, known collectively as OPEC+, are ramping up oil production after record cuts enacted when the pandemic took hold in 2020. OPEC+ has failed to fully realize in recent months production increases expected due to underinvestment in oil fields by some OPEC members and Russian production losses.
For 2023 prospects still uncertain
OPEC left its projection of world demand growth for 2023 unchanged at 2,7 million b/d and expects supply from non-cartel countries to increase by 1,71 million b/d. which means that OPEC will have to pump around 900.000 barrels a day more to balance the market.
