OPEC predicts high demand for oil globally

By Ibiyemi Mathew

The Organization of Petroleum Exporting Countries (OPEC) has predicted that the demand for oil globally will rise for another decade.

The organization which is set to review its World Oil Outlook said oil will last longer than many other forecasters predict, in a forthcoming major report, despite the growing demand for alternative energy sources.

Global oil demand fell by an estimated 1.1 million barrels per day (bpd) in July this year according a report from the Joint Organizations Data Initiative (JODI).

The demand decline was driven by drops in consumption in China, India, Indonesia, developed European economies, and Saudi Arabia, according to JODI, which compiles self-reported data from many countries.

OPEC made a shift in 2020 when the pandemic hit demand, saying it would eventually slow after years of predicting ever-increasing consumption. The latest update is likely to keep OPEC among the more bullish forecasters of oil demand.

Other predictions see oil demand peaking earlier. TotalEngergies has forecast this will take place before 2030.

Last year, OPEC saw oil demand reaching 108.2 million barrels per day in 2045, up from 90.6 million bpd in 2020.

The group steadily lowered the 2045 projection over the last few years, citing changes to consumer behaviour brought about by the pandemic and competition from electric cars.

The 2021 version sees oil demand reaching a plateau after 2035.

Another decade or more of oil demand growth would be a boost for producers and OPEC, whose 13 members depend on oil income, and would justify continued investment in new supplies.

OPEC is scheduled to update its long-term oil demand forecasts in its 2022 World Oil Outlook on October 31.