OPEC on Monday cut its oil demand growth estimate for a third consecutive month, due to actual consumption data so far this year and expectations of slightly lower demand in some regions.
OPEC now expects global oil demand to grow by 1.93 million barrels per day (bpd) in 2024, down by 106,000 bpd compared to last month’s assessment, the cartel’s Monthly Oil Market Report (MOMR) for October showed on Monday.
The third consecutive downward revision of global oil demand growth largely reflected “actual data received combined with slightly lower expectations for the oil demand performance in some regions,” OPEC said.
Chinese demand growth was cut again, and accounted for most of the downward revision of global oil demand growth in 2024. OPEC now expects China’s oil demand to grow by 580,000 bpd this year, down from the 650,000 bpd growth expected in the September report.
China’s annual demand growth slowed in August from July, to just 83,000 bpd year-over-year, with the increase driven by strong petrochemical feedstock requirements, OPEC said.
“Diesel consumption continued to be subdued by slowing economic activity, mostly a slowdown in building and housing construction, and the substitution of liquefied natural gas (LNG) for petroleum diesel fuel in heavy-duty trucks,” the organization’s economists wrote in the report.
OPEC also slashed its forecast of global oil demand growth for 2025, lowering the expected growth by 102,000 bpd to 1.6 million bpd.
Total global oil demand is thus expected to average 105.8 million bpd next year.
Developing economies in Asia and the Middle East will lead the 1.6 million bpd growth in 2025, accounting for 1.5 million bpd of it, led by contributions from China, Other Asia, the Middle East, and India, OPEC said. Oil demand in developed economies is set to inch up only by about 100,000 bpd, led by the Americas.
By Charles Kennedy for Oilprice.com