OPEC expects a demand slowdown in 2023

OPEC expects a demand slowdown in 2023

kurdsatnews

Jul 12, 2022

OPEC

The Organization of the Petroleum Exporting Countries (OPEC) expects global oil demand to rise next year, but at a slightly slower rate than in 2022, with consumption supported by better containment of the Covid-19 epidemic and global economic growth that remains strong.

In its monthly report, OPEC expects global oil demand to rise by 2.7 million barrels per day in 2023. It left growth forecasts this year unchanged at 3.36 million barrels per day.

Oil consumption has rebounded from the pandemic-induced recession in 2020 and is set to exceed 2019 levels this year even as prices rise to record levels. However, the rise in crude oil prices and the Coronavirus outbreak in China has affected the growth forecast for 2022.

"In 2023, the outlook for healthy global economic growth amid improvements in geopolitical developments, along with expected improvements in the containment of COVID-19 in China, is expected to lead to increased oil consumption," OPEC said in the report.

It stated that its forecasts for the year 2023 assume there is no escalation of the war in Ukraine and that risks such as high inflation will not negatively affect global economic growth.

The organization and its allies, including Russia, within the alliance known as "OPEC +", are working to increase production after the record cuts that were followed by the spread of the pandemic in 2020.

In recent months, OPEC+ has been falling behind on production target increases due to some OPEC members' lack of investment in oil fields and losses in Russian production.

The report shows OPEC production bucked this trend in June, rising by 234,000 barrels per day to 28.72 million barrels per day.

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