Global Oil Demand Growth Forecast Remains Robust in 2025 Despite Trade Concerns
The Organization of the Petroleum Exporting Countries (OPEC) has reaffirmed its projection for robust global oil demand growth in 2025, citing strong support from air and road travel. This forecast is part of OPEC’s monthly report released on Wednesday, which projects that global oil demand will rise by 1.45 million barrels per day in 2025 and by 1.43 million bpd in 2026. Notably, both forecasts remain unchanged from the previous month.
According to OPEC, while trade concerns are expected to introduce volatility as new trade policies are rolled out, the global economy is anticipated to adapt to these changes. This confidence in the global economy’s resilience is reflected in OPEC’s decision to maintain its robust growth forecast for 2025 and beyond.
Broadening Oil Production
In addition to its oil demand projections, OPEC also provided an update on oil production levels within the broader OPEC+ group. The organization reported that this collective increased production by 363,000 bpd in February. This increase was significant, with Kazakhstan being a notable contributor.
Kazakhstan’s production surged to 1.767 million bpd in February, up from 1.570 million bpd in January. Despite the country’s pledge to cut its output and compensate for overproduction, it has actually increased production at the Chevron-operated Tengiz oilfield, which is its largest.
Russia’s Oil Production Output
In contrast, Russia’s crude oil output slightly decreased by 0.04 percent to 8.973 million bpd in February, from 8.977 million bpd in January. This decrease was marginally below Russia’s production target of 8.98 million bpd under the OPEC+ agreement. Importantly, Russia’s quota is expected to rise to 9.004 million bpd starting in April as part of OPEC+’s planned gradual output increase.
Deputy Prime Minister Alexander Novak announced last week that OPEC+ had agreed to begin raising oil production in April, though this decision could be reversed if market imbalances arise. This development underscores the ongoing effort by OPEC and its allies to balance supply and demand in the global oil market while also addressing the economic implications of trade policies.
Economic Adaptation
The resilience of the global economy in adapting to trade concerns is a key factor underpinning OPEC’s robust growth forecast for 2025. The organization has noted that despite these challenges, the global economy is expected to find its footing and continue on a path of steady expansion. This confidence in economic resilience reflects a nuanced understanding of the complex interplay between global markets, trade policies, and economic trends.
Conclusion
The Organization of the Petroleum Exporting Countries’ reaffirmation of its robust growth forecast for 2025 underscores the organization’s confidence in the global economy’s ability to adapt to evolving trade policies and other challenges. The slight decrease in Russia’s oil production output is notable but does not alter the broader trend towards increased global oil demand, which remains a key driver of OPEC’s forecasts. As the global energy landscape continues to evolve, OPEC’s reports will provide essential insights into the complex interplay between supply and demand, trade policies, and economic trends.