OPEC anticipates that global oil consumption will increase in 2023, although at a slower rate than this year, according to a monthly report released on Tuesday, citing economic growth and success in limiting COVID-19 in China.

The Organization of Petroleum Exporting Countries (OPEC) forecasts a 2.7 million barrel per day (bpd) increase in demand in 2023. It maintained its growth target for this year at 3.36 million bpd.

Despite the effect of the Ukraine conflict, increasing costs and inflation, and tight Chinese efforts to reduce COVID infections, oil consumption has recovered from the pandemic-induced decline in 2020 and is likely to approach 2019 levels this year.

“In 2023 expectations for healthy global economic growth amidst improvements in geopolitical developments, combined with expected improvements in the containment of COVID-19 in China, are expected to boost consumption of oil,” OPEC stated in the research.

OPEC’s first demand prediction for 2023 is more positive than the International Energy Agency’s forecast, as well as early opinions among OPEC delegates asking for a harsher downturn. more info

OPEC’s projections for 2023 presume that the situation in Ukraine will not escalate and that concerns like as inflation would not have a significant impact on global economic development.

OPEC maintained its prediction for global economic growth of 3.5 percent this year and 3.2 percent in 2023, stressing that uncertainty remained skewed to the negative and upside potential was “quite limited”

After the data was issued, oil continued to fall, trading below $103 a barrel and much below the near-record high of $139 set in March.

The organization and its allies, including Russia, are increasing oil supply after imposing historic limits when the epidemic began in 2020.

OPEC+ has been undershooting anticipated production increases in recent months due to underinvestment in oilfields by several OPEC members and losses in Russian supply.

According to the data, OPEC production defied the trend in June, increasing by 234,000 bpd to 28.72 million bpd.

Source: Reuters


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