The Organization of Petroleum Exporting Countries (OPEC), a group of oil-producing states led by Saudi Arabia and Russia, reduced its oil demand forecast for 2024 and 2025. The cut is the group’s fifth consecutive monthly cut to forecasts and its deepest yet.
The new projections cut the expected growth in daily oil consumption to 1.6 million barrels per day — representing a 27% cut in the group’s forecasts since July.
The cuts come as OPEC “belatedly recognizes the deteriorating market picture,” Bloomberg noted: Oil prices have dropped by 17% in the last six months, as production has boomed in the US while demand from the world’s top oil importer, China, has slowed as the country pivots to renewable energy.
Still, OPEC’s projections remain industry outliers: The group’s expectations are roughly double the estimates of Morgan Stanley and Goldman Sachs, as well as those of Saudi Arabia’s state-run oil company, Aramco.
