Opec: Oil demand remains robust despite price rises

Opec is predicting high global demand in 2024 despite oil prices hovering at $90 per barrel.

The oil producer group said in its latest monthly report that it expects demand to increase by 2.25m barrels per day this year and by a further 1.85m bpd in 2025.

Tankers in pole position as crises and economic woes trigger uncertainty in shipping

Read more

The predictions are unchanged from last month but are significantly different from forecasts by the International Energy Agency (IEA), which represents major consumers from industrialised nations.

The IEA has predicted much lower growth of 1.3m bpd this year before hitting peak demand by 2030 as the shift to greener fuels cuts demand for fossil fuels. It is due to report its latest forecast on Friday.

The contrasting Opec view was voiced by secretary general Haitham Al Ghais, who said in January that global demand is likely to reach 116m bpd by 2045. Demand topped 100m bpd last year for the first time.

The monthly report said tanker spot rates were steady in March, although significantly down from the previous year. VLCCs were down 19% year on year, suezmaxes down 25% and aframaxes down 33%.

Product tanker rates were mixed in March, down 8% East of Suez compared with the previous month but 10% higher West of Suez.

The price of oil is up about 19% this year following cuts by Opec countries and its allies, led by Saudi Arabia and Russia, and concerns over the impact of fighting in the Middle East. The Opec+ countries said last week that the cuts would remain until June.

The continued strong oil demand predicted by Opec is backed by projected growth for the global economy of 2.8% this year and 2.9% in 2025, driven by China and India, according to its report.

“The robust oil demand outlook for the summer months warrants careful market monitoring, amid ongoing uncertainties, to ensure a sound and sustainable market balance,” it said.