2023-12-16 23:39:48
Oil prices rose sharply yesterday, benefiting from bullish forecasts from OPEC and the IEA, as well as rising geopolitical risk.
Black gold prices were on track to record their first weekly increase, and end a streak of seven consecutive weeks of declines. The Organization of the Petroleum Exporting Countries maintained its oil demand growth forecast for this year and next in its December monthly report.
OPEC cites better-than-expected economic performance so far, while attributing the recent drop in oil prices to “exaggerated concerns regarding growing oil demand.”
In its Monthly Oil Market Report (MOMR) released on Wednesday, OPEC kept its forecast for global oil demand growth in 2023 unchanged from last month’s assessment, at 2.5 million barrels per month. day (b/d). OPEC also forecasts “global economic growth of 2.9% this year and 2.6% for the year 2024”.
For the remainder of 2023, OPEC continues to expect global oil demand to average 102.1 million b/d, driven by demand from non-OPEC countries. OECD. “Oil demand is expected to be supported by resilient global GDP growth, amid continued improvement in economic activity in China,” the Organization said.
“Continued improvement in economic activity, stability in manufacturing and transportation activities, primarily in China, other Asian countries and the Middle East, as well as India and Latin America, are expected to account for the bulk of oil consumption,” according to OPEC.
The Organization also noted that “economic growth observed during the first three quarters of this year, in most key economies, was better than expected.”
In the November report, OPEC said oil market fundamentals remained strong and Chinese crude imports were expected to hit a new annual high in 2023, despite “exaggerated negative market sentiment regarding demand performance.” of oil in China and on the world oil market in general.
For its part, the International Energy Agency (IEA) has also revised upwards oil demand for next year. Global oil consumption will increase by 1.1 million barrels per day (bpd) in 2024, the IEA said in its monthly report, up 130,000 bpd from its previous forecast, citing an improvement in the outlook for American demand.
Oil prices were also supported yesterday by geopolitical factors, including a series of missile and drone attacks on ships in the Red Sea from the Yemeni coast. One of the largest tanker companies, Maersk Tankers, told its fuel carrier crews that they might now bypass the area.
Brent crude futures rose well above $76 a barrel in trading, while U.S. West Texas Intermediate (WTI) crude climbed well above $71. The two benchmark indices were on track to experience a first weekly gain, following two months of strong instability.
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