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OPEC report: Reducing demand growth forecasts for OPEC oil in 2021 and 2022
OPEC on Thursday stuck to its forecast for a strong recovery in global oil demand in 2021 and more growth next year, despite concerns about the spread of the mutated delta strain of the coronavirus that are weighing on prices.
The Organization of the Petroleum Exporting Countries (OPEC) said in its monthly report that it expects demand to rise by 5.95 million barrels per day this year, or 6.6 percent, unchanged from its forecast last month.
"The global economy continues to recover...but there are still many challenges which could easily dampen the momentum. In particular, developments related to COVID-19 will need to be closely monitored," OPEC said in the report.
OPEC's confidence that demand will ignore the latest setbacks caused by the pandemic contrasts with the position of the International Energy Agency, which trimmed its forecasts on Thursday.
OPEC stated that in 2022, fuel use will increase by 3.28 million barrels per day, also unchanged from expectations issued last month.
Oil is trading above $71 a barrel after the release of the report. Prices have risen to pre-pandemic highs above $77 this year, supported by hopes of economic recovery and OPEC + supply cuts, but there are pressures caused by concerns about the delta strain.
OPEC raised its forecast for global economic growth in 2021 to 5.6 percent from 5.5 percent, assuming that the impact of the pandemic would be contained, but warned of "great uncertainty". The forecast for 2022 was similarly raised to 4.2 percent.
