The world oil demand is expected to grow by 1.51 million barrel per day (mb/d) above the 1.26mb/d earlier forecasted for year 2018, the Organisation of Petroleum Exporting Countries (OPEC) has said.
The forecast was based on the strong optimism that the world economy will grow very fast within the period.
The OPEC said in its Monthly Oil Market Report released on Wednesday that the countries under the Organisation for Economic Co-operation and Development OECD will contribute positively to oil demand growth, adding some 0.28 mb/d, whereas the bulk of the growth will come from the non-OECD with 1.23 mb/d of potential growth.
The report said World Oil Supply Non-OPEC oil supply growth for 2017 now stands at 0.81 mb/d, representing an upward revision of 0.15 mb/d from the previous report. For 2018, the forecast for non-OPEC supply growth has been revised up by 0.12 mb/d to now stand at 0.99 mb/d.
“The 2018 forecast for non-OPEC supply is associated with considerable uncertainties, particularly regarding US tight oil developments. US oil supply is now expected to grow by 1.05 mb/d next year, representing an upward revision of 0.18 mb/d and following growth of 0.61 mb/d in 2017. OPEC NGLs and non-conventional liquids are expected to increase by 0.18 mb/d in 2018, compared to 0.17 mb/d this year. In November, OPEC crude production decreased by 133 tb/d, according to secondary sources, to average 32.45 mb/d.”
“World economic growth in 2017 has been supported by strong momentum across all major economies and sectors. Growth now stands at 3.7%, up from an initial forecast of 3.2%. The healthy momentum is expected to continue in 2018, with growth forecast at 3.7%. The OECD, supported by the US and the Euro-zone and to some extent Japan, is considered a vital element of this dynamic, with growth of 2.2% in 2018, only slightly below this year’s 2.3%.
“In the non-OECD, the growth momentum in China is forecast to slightly decelerate in 2018 to 6.5%, compared to 6.8% in 2017. India is likely to rebound from sluggish growth of 6.5% in 2017 to show growth of 7.4% in 2018. Brazil and Russia are Graph 1: Real GDP growth for selected countries in 2018 forecast to continue their recovery at growth of 1.5% and 1.8% in 2018, after 2017 growth of 0.8% and 1.9%, respectively. As many economies now expand at or even above growth potential, the upside may be limited.