The Organisation of Petroleum Exporting Countries (OPEC), has expressed optimism in oil demand growth in 2024 despite the current market slowdown.
According to sources close to OPEC, the body will likely maintain an upbeat view on oil demand growth for next year by the time it publishes its first outlook later this month, predicting a slowdown from this year but still an above-average increase.
The OPEC’s forecast for 2024 will likely be lower than the growth it expects for this year of 2.35 million barrels per day, or 2.4 per cent, an abnormally high rate as the world moves out of the coronavirus pandemic.
Even so, it would still be well above the annual average of the past decade with the exception of the pandemic years and above predictions by the International Energy Agency(IEA), which sees a major slowdown in demand growth next year to 860,000 bpd.
OPEC and the IEA have repeatedly clashed in recent years, with OPEC criticising the IEA, which advises industrialised countries, for what it sees as irresponsible predictions and subsequent data revisions.
Oil demand growth is an indication of likely oil market strength and forms part of the backdrop for policy decisions by OPEC and its allies, known as OPEC+. The group in June extended supply curbs into 2024 to support the market as concern over weakening demand pressured prices.