In its monthly report, OPEC said it expected global oil demand to increase by 2.7 million barrels per day in 2023, and kept its forecast for demand growth this year unchanged at 3.36 million barrels per day.
The report revealed that the organization’s production deviated from expectations in June and increased by 234,000 barrels per day to 28.72 million barrels per day.
Oil use increased following its decline due to the pandemic in 2020, and is expected to exceed 2019 levels this year with prices reaching record high levels. However, rising crude prices and the outbreak of the Corona virus in China have reduced growth forecasts for 2022.
And the OPEC report stated that “expectations of strong economic growth in 2023 in light of improved geopolitical developments, along with the expected improvement in containing Covid-19 in China, which is expected to increase oil consumption.”
The organization’s forecast for oil demand in 2023, the first of its forecasts for this year, was more optimistic than the International Energy Agency, as well as preliminary views of the organization’s delegates reflected a further slowdown.
OPEC said its 2023 forecast assumes that there will be no escalation in the Ukraine war and that risks such as rising inflation will not have a strong impact on global economic growth.
It also kept its forecast for global economic growth this year at 3.5 percent and expects growth of 3.2 percent in 2023, adding that the possibility of fluctuations between ups and downs is “very limited.”
Oil consolidated following falling earlier following the report was announced, and was trading at less than $103 a barrel and lower than the levels it reached in March at $139 a barrel.
The organization and its allies, including Russia, or the bloc known as “OPEC +”, are raising production following record cuts in 2020 due to the pandemic.
In the past months, “OPEC +” reduced the targeted production increases due to the lack of investment by some OPEC members in oil fields and Russian production losses.
