OPEC cuts forecast of rising oil demand to 2.5m barrels a day

The Organization of the Petroleum Exporting Countries (OPEC) has revised downward its forecast for an increase in global oil demand in 2022 from 2.6 million barrels per day (bpd) to 2.5 million bpd, according to a monthly report published on Monday. thursday the 14th.

OPEC estimates that demand from Organization for Economic Co-operation and Development (OECD) countries will account for 1.3 million bpd of the forecasted total. The projected growth in demand from nations outside the group is also 1.3 million bpd.

For 2023, OPEC also cut its forecast for rising global consumption from 2.3 million bpd to 2.2 million bpd.

Offer outside the group

OPEC maintained its forecast for increased oil supply from producers outside the group in 2022 at 1.9 million barrels a day, according to the monthly report.

The countries that should contribute most to the increase in supply this year are the United States, Norway, Canada, Brazil, Kazakhstan and Guyana, says the organization. At the other end, production should fall in Russia and Mexico.

For 2023, OPEC also maintained its forecast for an increase in supply outside the group, of 1.5 million bpd.

Brazil’s liquid production

OPEC expects Brazil to increase its production of liquids, which includes biofuels, by 0.1 million barrels per day (mb/d), to 3.7 mb/d, according to a monthly report. For 2023, the forecast is also for growth, from 0.2 mb/d to 3.9 mb/d.

According to OPEC, next year, “a large part of the growth in production will come from the pre-salt frontier”.

Group production between September and October

Production by the 13 members of the Organization of Petroleum Exporting Countries (OPEC) dropped 210,000 barrels per day (bpd) between September and October, to 29.49 million bpd, according to secondary sources. The information is contained in the entity’s monthly report.

OPEC reports that production rose especially in Nigeria and Iraq, but declined in Saudi Arabia and Angola.

In addition to the drop in the cartel’s production, the entity expressed concern about “considerable uncertainties” about the potential for shale production in the US, as well as the geopolitical situation in Eastern Europe, which could lead to European Union (EU) sanctions on oil. from Russia.

In the monthly report, OPEC also highlights the increase of 158 million barrels in global oil inventories since the beginning of the year. “This underlines the apparent shift from a deficit balance to a surplus in terms of oil supply,” ponders the cartel.

Global activity projections

OPEC kept its forecasts for world economic growth in 2022 and 2023 unchanged, at 2.7% and 2.5%, respectively. In the monthly report, the entity states that it also maintained its growth forecast for the US, at 1.5% in 2022 and 0.8% in 2023, and for the euro zone growth – 3.0% in 2022 and 0, 3% in 2023.

The same is true for China, whose expansion forecast is 3.1% in 2022 and 4.8% in 2023.

For Brazil, the economic expansion forecast was unchanged at 1.5% for 2022 and 1% for 2023.

OPEC still forecasts a contraction of Russia’s GDP in 2022 of 5.7%, followed by a growth of 0.2% in 2023, unchanged from last month’s assessment.

For OPEC, “global growth has clearly entered a period of significant uncertainty and growing challenges. This includes high levels of inflation and the consequences of monetary tightening by major central banks, high levels of sovereign debt in many regions and supply chain problems.”

OPEC also highlights geopolitical and Covid-19-related issues as sources of uncertainty.