OPEC Revises Global Oil Demand Forecast
OPEC has lowered its global oil demand forecasts for the next four years due to slower economic growth in China. Despite this, the organisation raised its long-term outlook, anticipating rising oil consumption in developing regions. OPEC emphasises that global oil use has not yet peaked. The group continues to increase production to regain market share after years of output cuts designed to support prices.
Recent Demand Projections
OPEC’s 2025 World Oil Outlook predicts world oil demand will average 105 million barrels per day (bpd) this year. Demand is expected to rise to 106.3 million bpd in 2026 and reach 111.6 million bpd by 2029. These medium-term forecasts are lower than last year’s estimates. For example, the 2026 forecast has been cut from 108 million bpd to 106.3 million bpd. The 2029 forecast dropped by 700,000 bpd compared to the previous year.
Comparison with Other Forecasters
Unlike OPEC, organisations such as BP and the International Energy Agency (IEA) expect global oil demand to peak within this decade. The IEA projects demand to peak at 105.6 million bpd by 2029 before declining slightly in 2030. OPEC, however, maintains that oil consumption will continue growing beyond 2030, reaching 113.3 million bpd that year.
Factors Influencing Demand Trends
Slower growth in China is a key factor in the downward revision of near-term demand. China’s economic slowdown, faster adoption of electric vehicles (EVs), expansion of charging infrastructure, and substitution of oil in various sectors are reducing oil consumption growth. Meanwhile, OPEC expects demand growth to be driven by India, the Middle East, and Africa in the longer term.
Production and Supply Adjustments
OPEC+ has started to ease output cuts of 2.17 million bpd with monthly production increases since April 2025. However, deeper cuts of 3.65 million bpd remain in place until the end of 2026. There has been no discussion about ending these additional cuts. The group is balancing the need to regain market share with maintaining price stability.
Long-Term Outlook and Investment Needs
OPEC forecasts world oil demand will rise to 122.9 million bpd by 2050, higher than last year’s estimate of 120.1 million bpd. This contrasts with other industry forecasts that expect demand to decline due to energy transition efforts. OPEC marks the need for $18.2 trillion in oil sector investment by 2050 to meet demand, up from $17.4 trillion estimated last year.
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