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IEA largely keeps demand growth forecast for 2024 stable at 970,000 barrels per day

In its monthly market report, Petroleum The International Energy Agency (IEA) has maintained its forecast for global oil demand growth in 2024 at 970,000 barrels per day (bpd), the report said on Thursday.

Extra points

Global supply growth in 2025 is set to reach 1.8 million bpd, with the US, Canada, Guyana and Brazil leading the gains.

Oil supply growth in 2024 is expected to reach 770,000 bpd, bringing oil supply to a record 103 million bpd.

OPEC+ crude demand in the third quarter is forecast to be 800,000 bpd higher than June production.

Lower economic growth, increased efficiencies and vehicle electrification will weigh on demand in 2024 and 2025.

China accounted for 70% of global demand gains in 2023, but only about 40% in 2024 and 2025.

Chinese consumption contracted as the post-pandemic rebound has come to an end.

Oil demand growth slowed to 710,000 in 2024, the smallest quarterly increase in more than a year.

Lowers forecast for oil demand growth to 2025 by 50,000 bpd to 980,000 bpd.

Market reaction

At the time of writing, WTI is holding steady around $81.50.


WTI crude oil is a type of crude oil sold on international markets. WTI stands for West Texas Intermediate, one of three main types that include Brent and Dubai crude. WTI is also known as “light” and “sweet” for its relatively low gravity and sulfur content, respectively. It is considered a high-quality oil that is easily refined. It is sourced in the United States and distributed through the Cushing hub, considered “the pipeline crossroads of the world.” It is a benchmark for the oil market and the price of WTI is frequently quoted in the media.

Like all assets, supply and demand are the main factors determining the price of WTI crude oil. As such, global growth can be a driver of increased demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can disrupt supply and impact prices. Decisions by OPEC, a group of large oil producing countries, are another key driver of price. The value of the US Dollar influences the price of WTI crude oil, as oil is primarily traded in US Dollars, so a weaker Dollar can make oil more affordable and vice versa.

The weekly oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect fluctuations in supply and demand. If the data show a decrease in inventories, it may indicate an increase in demand, which would push up the price of oil. An increase in inventories may reflect an increase in supply, which pushes down prices. The API report is published every Tuesday, and the EIA report the following day. Their results are usually similar, with a difference of 1% between them 75% of the time. The EIA data is considered more reliable because it is a government agency.

OPEC (Organization of the Petroleum Exporting Countries) is a group of 13 oil-producing nations that collectively decide on member countries’ production quotas at biennial meetings. Their decisions often influence WTI oil prices. When OPEC decides to reduce quotas, it can restrict supply and drive up oil prices. When OPEC increases production, the opposite effect occurs. OPEC+ is an expanded group that includes ten other non-OPEC countries, most notably Russia.

Source: Fx Street

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