Friday May 24, 2024

OPEC sees robust summer oil demand

By News Desk
April 13, 2024
This image shows OPEC written on a building. — AFP/File
This image shows OPEC written on a building. — AFP/File

LONDON: OPEC predicted robust fuel use in the summer months and stuck to its forecast for relatively strong growth in global oil demand in 2024, highlighting an unusually large gap between predictions of oil demand strength.

The Organization of the Petroleum Exporting Countries, in a monthly report, said world oil demand will rise by 2.25 million barrels per day (bpd) in 2024 and by 1.85 million bpd in 2025.

Both forecasts were unchanged from last month.A boost to economic growth could give extra tailwind to oil prices, which have rallied above $90 a barrel this year on tighter supply and war in the Middle East.

OPEC and its allies, known as OPEC+, last week agreed to keep oil output cuts in place until the end of June."Despite some downside risks, the continuation of the momentum seen in the beginning of the year could result in further upside potential for global economic growth in 2024," OPEC said in the report.

Looking ahead to the summer, when fuel demand rises seasonally as people travel more, OPEC said global jet/kerosene fuel demand will rise by 600,000 bpd year on year in the second quarter, gasoline by 400,000 bpd and diesel by 200,000 bpd.

Following last week's meeting of a panel of top OPEC+ ministers, the full group will meet in June to decide whether to extend output cuts further or return some supply to the market.

"The robust oil demand outlook for the summer months warrants careful market monitoring, amid ongoing uncertainties, to ensure a sound and sustainable market balance," the report said.OPEC sees world economic growth of 2.8% in 2024, steady from last month, and said the U.S. economy was set to give the traditional summer boost to fuel demand.