The Organization of the Petroleum Exporting Countries (OPEC) anticipates that its projected 2.2 million barrels per day economic growth for 2024 will play a pivotal role in influencing global oil market dynamics, as outlined in its December monthly report.
The report forecasts a 2.2 mb/d year-on-year increase in global oil demand for 2024, with significant contributions from OECD Americas, China, the Middle East, Other Asia, and India.
This outlook hinges on sustained economic and petrochemical activity, driving demand for transportation fuels and distillates.
On the supply side, non-OPEC supply growth is predicted at 1.8 mb/d in 2023, with the U.S. accounting for about 70% of this expansion. Notable contributors to growth in 2024 include U.S. tight oil output, offshore projects in Latin America and the North Sea, and the expansion of oil sands projects in Canada.
OPEC highlights that the economic growth experienced in key economies during the first three quarters of the current year surpassed expectations.
Consequently, the global economic forecast for 2023 stands at 2.9%, with expectations of a continued robust growth extending into 2024, albeit at a slightly moderated rate of 2.6%.
The U.S. is projected to lead this growth, comprising approximately 44% of the total, followed by Canada, Guyana, Brazil, Norway, and Kazakhstan.
Despite an estimated 11% year-on-year increase in non-OPEC upstream sector investment to around $487 billion in 2023, the forecast indicates a slight drop to about $482 billion in 2024.
As 2023 concludes, OPEC expresses cautious optimism regarding the fundamental factors affecting oil market dynamics in 2024.
To address uncertainties, countries participating in the Declaration of Cooperation (DoC) announced additional voluntary adjustments in 1Q24 to maintain stability.
OPEC emphasizes its commitment to sustaining a stable oil market, with estimates indicating a need for $12.1 trillion in investments to meet rising long-term oil demand.
OPEC Secretary General Haitham Al Ghais emphasizes the importance of investing across all energy sectors and focusing on reducing greenhouse gas emissions.
