OPEC forecasts 6.2m bpd rise in 2021 global oil demand

Global oil demand will scale up by 6.2 million barrels per day (mbpd) per day next year as national economies gradually find recovery from the headwinds of the coronavirus outbreak, the Organisation of the Petroleum Exporting Countries (OPEC) said on Monday.

“Our OPEC outlook for 2020 oil demand is now slightly above 90 million bpd.

“This represents a sharp decline of nearly 10 million b/d from where we started the year, and almost an 11million b/d contraction compared to what we forecast in January,” said Mohammad Barkindo, secretary-general of the Vienna-based organisation in a virtual speech at the Crescent Ideas Forum on Monday.

“In 2021, we expect growths to bounce back to 6.2 million b/d to just over 96 million b/d, compared to our pre-Coronavirus (COVID-19) expectations for demand reaching almost 102 million b/d next year.

“The recent revisions are due to the easing pace of the economic recovery and recent COVID-19 containment measures, which are assumed to impact transportation and industrial fuel demand well into next year,” he added.

Read also: Oil prices climb on hints of OPEC+ output increase delay, Bonny Light loses $0.97

The move to stabilise the oil market has been made more difficult by a surge in inventory levels that pushed commercial oil stocks of the Organisation for Economic Cooperation and Development to 208 million barrels above the current five-year average, according to October preliminary data.

In contrast, the figure for January was 13 million barrels.

Barkindo observed that the world’s stocks had ballooned by over one billion barrels so far this year.

“These figures would have been dramatically higher and clearly unsustainable had it not been for the unprecedented cooperative efforts taken to address the imbalance in fundamentals and stabilise the market.”

Oil demand is predicted to climb by 10 million bpd from 2019 levels to about 109 million bpd in 2040.

“In absolute terms, we expect oil demand in the developing and emerging economies rising by 22.5 million bpd to around 74 million bpd in 2045. “The outlook for crude oil may look anemic now, but we anticipate a gradual normalisation of demand growth as the world recovers from the COVID-19 shock,” he said.

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