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OPEC’s top official said global oil demand will continue strong growth this year and a peak in consumption doesn’t appear to be on the horizon.
“We are seeing positive signs of good revisions to some parts of the global economy, most notably the United States,” OPEC Secretary-General Haitham Al Ghais told a panel at the World Governments Summit in Dubai on Tuesday. “I think talking about peak oil demand is probably something way far out.”
Several influential forecasters predict that oil demand will hit a maximum in the coming years, as countries switch to renewable energy and electric vehicles in an effort to avoid damaging climate change. The International Energy Agency in Paris anticipates a peak before the end of this decade. The Organization of Petroleum Exporting Countries has been a notable exception to this view.
“We still feel very robust” about China and see a “phenomenal economic growth” in India, Al Ghais said. OPEC predicts an increase in global oil demand of more than 2 million barrels a day this year, a continuation of the healthy growth seen in 2023, he said.
Oil demand has surged in the past couple of years as the appetite for transport fuels bounced back from the pandemic. Yet OPEC and its allies have been deepening their production cuts and oil has remained in a range near $80 a barrel in London as supplies from elsewhere satisfy the increase in consumption.
“We’re seeing good production coming out of Guyana, out of Brazil, Canada,” Al Ghais said. There could be a slowdown in output growth in the US, but he cautioned that the industry there has proved “it’s resilient and we keep seeing a surprise in shale production, year on year.”
In this environment OPEC+ will “continue to be very preemptive, proactive,” Ah Ghais said.
