OPEC: 20% growth in oil demand by 2025

Written By Mark

OPEC expected a growth in demand for oil of approximately 20% to reach a value of 116 million barrels per day by 2025, indicating that oil will continue to dominate about 30% of the global energy mix.

According to what the CEO of the Russian company Rosneft said in his speech at the 27th International Economic Forum in St. Petersburg, developing countries will be the main driver of oil consumption in the coming decades. It is expected that demand growth in this group of countries will constitute 95% of global consumption growth in total by 2030. It is also expected that the highest growth in demand for oil will be in Asian countries, with which Russia is the main trading partner.
Oil prices witnessed a recovery last week, after a sharp decline in early June as a result of intense selling operations by hedge funds, which coincided with a decline in geopolitical risks and the announcement by the OPEC Plus alliance of plans to gradually withdraw from the additional voluntary production cuts imposed last year. The reduction will take effect from October, provided that prevailing market conditions continue. During recent months, weak demand and increased supply from outside OPEC Plus prevented the market from tightening to the extent that would allow supplies to be re-pumped into it.
The monthly oil market reports issued last week by OPEC and the International Energy Agency also revealed a noticeable widening of the gap between their respective expectations for oil demand growth in the years 2024 and 2025.
On the other hand, OPEC maintained its expectations of strengthening demand for oil in the second half of the year amid continued economic growth in China and other emerging economies. She indicated that the OPEC+ alliance will need to pump an additional 2.7 million barrels per day in the third quarter, which leaves ample room for the announced retreat from production cuts. However, it is clear that the direction of crude oil prices in the coming months will depend on the validity of any of the forecasts. With half the year already gone, it is unusual to see such a wide gap between two institutions that should have the same amount of data and information.