OPEC maintains 2024 oil demand outlook, predicts strong travel season

MOSCOW/LONDON (July 10): The Organization of the Petroleum Exporting Countries (OPEC) maintained its forecast for relatively solid growth in global oil demand in 2024 and next year, saying on Wednesday that solid economic growth and stronger air travel should support fuel use in the summer.

The Organization of the Petroleum Exporting Countries (OPEC) said in its monthly report that global oil demand is set to grow by 2.25 million barrels per day in 2024 and 1.85 million barrels per day in 2025. Both forecasts were unchanged from the previous month.

“Expected increases in travel and air travel in the Northern Hemisphere during the summer driving and holiday season are expected to boost demand for transportation fuels and support growth in the United States,” OPEC said in the report.

Forecasters are more divided than usual on how strong oil demand growth should be, in part because of differences over the pace of the world’s transition to cleaner fuels. BP said earlier in the day that oil demand will peak next year.

OPEC+, the group made up of the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, has been implementing a series of production cuts since the second half of 2022 to support the market. The group agreed on June 2 to extend the latest cut of 2.2 million barrels per day until the end of September, with a phased reduction starting in October.

OPEC also raised its forecast for global economic growth this year to 2.9 percent from 2.8 percent, saying the figure could be on the upside due to strength seen outside the Organisation for Economic Cooperation and Development (OECD) countries this year.

“Economic growth momentum in major economies remained strong in the first half of the year, a trend that supports an overall positive growth trajectory in the near term,” OPEC said.

Oil prices stabilized after the release of the OPEC report, with Brent crude trading below $85 a barrel.

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