A Petroleos de Venezuela SA oil pumpjack on Lake Maracaibo in Cabimas, Zulia state, Venezuela, on Friday, Nov. 17, 2023.
Gaby Oraa | Bloomberg | Getty Photos
The Worldwide Vitality Company on Thursday stated proof of softening world oil demand is mounting and a slowdown is predicted to proceed into 2024, reaffirming a starkly completely different outlook in contrast with oil-producing group OPEC.
The IEA stated oil market sentiment had turned “decidedly bearish” in current weeks, even after some members of OPEC and non-OPEC oil-exporting allies — collectively often called OPEC+ — on Nov. 30 introduced a brand new spherical of voluntary manufacturing cuts within the first quarter of subsequent yr.
Oil costs have been greater Thursday morning, paring losses after lately falling to their lowest stage since late June on gnawing oversupply considerations.
Worldwide benchmark Brent crude futures with February expiry traded 1.4% greater at $75.31 per barrel at 9 a.m. London time, whereas U.S. West Texas Intermediate crude futures for front-month January traded 1.3% greater at $70.36 per barrel.
In its newest month-to-month oil market report, the IEA stated world demand was heading in the right direction to rise 2.3 million barrels per day to 101.7 million barrels per day in 2023, noting that this forecast “masks the impression of an additional weakening of the macroeconomic local weather.”
The power company warned that “proof of a slowdown in oil demand is mounting,” with the tempo of enlargement poised to “gradual drastically” from 2.8 million barrels per day yr on yr within the third quarter to 1.9 million barrels per day within the ultimate three months of 2023.
It prompted a downward revision of the IEA’s world consumption development forecast of practically 400,000 within the fourth quarter, with weaker-than-anticipated demand in Europe, Russia and the Center East accounting for the majority of that adjustment.
Wanting forward, the IEA stated oil consumption development is projected to halve subsequent yr, falling to 1.1 million barrels per day as world financial development stays beneath pattern in main economies, and as Covid-19-related distortions fade.
IEA vs. OPEC
OPEC, in the meantime, struck a markedly completely different tone in its newest month-to-month report.
The oil producer group, which has regularly clashed with the IEA in recent times over points comparable to peak oil demand and the necessity for funding in new provides, on Wednesday stated that it remained “cautiously optimistic” about market dynamics in 2024.
OPEC blamed “exaggerated considerations” about oil demand development for a current downturn in crude costs and maintained its comparatively excessive oil use prediction for subsequent yr.
It reaffirmed its outlook for world oil demand development in 2023 at 2.46 million barrels per day, roughly in step with the IEA’s forecast.
For subsequent yr, OPEC stated it sees world oil demand at 2.25 million barrels per day, unchanged from the earlier month, however a sharply greater estimate than the IEA’s prediction of 1.1 million barrels per day for the interval.
