OPEC lowers forecasts for NON-OPEC supply growth in 2024, 2025
Muscat – OPEC has indicated that it is more optimistic on the challenge of mitigating nonOPEC supply growth in the coming months, with downward revisions to expected production growth outside the bloc in 2024 and 2025.
A recent price rally has eased some pressure on the group, which continues to implement major supply cuts, despite the rapid growth in NON-OPEC supply.
According to a report published by S&P Global Commodity Insights, the recent uptick in oil prices – supported by the overlapping cuts by the wider OPEC+ alliance and conflict in the Middle East and Europe – has led some analysts to forecast that the group may move to wind down some of its cuts in the second half of the year.
OPEC, as per the report, said in its closely watched monthly oil market report that it will remain vigilant and is prepared to act alongside its allies if necessary.
"The robust oil demand outlook for the summer months warrants careful market monitoring, amid ongoing uncertainties, to ensure a sound and sustainable market balance,"
OPEC said, as reported by S&P Global Commodity Insights.
It sees NON-OECD regions, mainly China, the Middle East and other countries in Asia driving demand. The group next plans to discuss policy on June 1, but its agreements include the option to convene earlier, if market conditions warrant.
NON-OPEC supply
OPEC forecasts that NON-OPEC supply will grow by 1mn barrels per day (bpd) in 2024 – revised down by 100,000 bpd from its previous report released in early March.
It also revised down its estimate of NON-OPEC supply growth in 2025 by 100,000 bpd to 1.3mn bpd, the report said.
OPEC sees the bulk of this growth coming from the US, Brazil, Canada, Russia, Kazakhstan and Norway. The bloc did not change its forecasts for global demand growth, or the call on its own crude in 2024 and 2025.
OPEC expects global oil demand to grow by 2.2mn bpd in 2024, with slight upward revisions to OECD Europe demand estimates offset by downward revisions to Africa and the Middle East. It forecasts global demand growth of 1.8mn bpd in 2025. OPEC'S demand forecasts for its own crude were also unchanged at 28.5mn bpd in 2024, and 29mn bpd in 2025.
The 2024 forecast is 1.9mn bpd above current production, which would give OPEC significant influence over oil prices this year if it came to pass. OPEC said that its March crude output was up 3,000 bpd month on month at 26.6mn bpd, according to secondary sources, including S&P Global analysts.