Global oil demand growth is likely to slow. That is the prediction of OPEC’s November World Oil Outlook, which revised last year’s projections downward. From current global oil demand of about 99 million barrels a day (bpd), it forecasts a rise to just 104.8 by 2024, reaching 110.6 million bpd by 2040.
As for OPEC’s own production of crude oil and other liquids, the report forecasts a decline from 35 million bpd this year to 32.8 million bpd by 2024. In contrast, and somewhat surprisingly considering the current climate anxiety, OPEC expects its members’ production of crude to rise to around 44.4 million bpd in 2040.
The demand drivers
There are a number of interrelated drivers behind the worldwide demand for crude. Overall, OPEC expects a slow-down in the demand growth for oil, largely attributable to a peak in demand from OECD countries. However, rising demand from non-OECD countries will underpin oil production at least for the next two decades. Thus crude prices, alongside expectations of demand, will continue to govern the pace of exploration and development. But the prevailing known-unknown in this equation is the velocity at which gas, renewable energy and electrification of transportion occurs, all at the expense of crude.