Brent crude dips below $70 after OPEC signals fall in oil demand
OPEC trims crude oil demand outlook for 2024 and 2025; Brent crude falls to its lowest in nearly 3 years.
- Sep 11, 2024,
- Updated Sep 11, 2024 10:38 AM IST
Crude oil prices plunged by more than $3 per barrel on Tuesday, ending the day below $70 a barrel for the first time since November 2021. The fall in prices came after the Organisation of the Petroleum Exporting Countries (OPEC) and its allies lowered their demand outlook for 2024 and 2025.
The world’s largest oil-producing cartel has lowered its 2024 estimate by 100,000 barrels per day (bpd) to 2 million bpd. The level is still well above the historical average of 1.4 million bpd prior to the Covid pandemic.
In its September Oil Market Report, OPEC has also lowered by 40,000 bpd its previous estimate for 2025. The demand for crude is however seen rising next year to 1.7 million bpd.
India's oil demand in 2024 is seen at 5.61 million bpd, 5% higher than in 2023, OPEC said. In 2025, the country is expected to consume 5.85 million bpd of oil, a growth of 4.3% on a year-on-year basis. Both estimates are marginally up from the previous month's estimates.
Demand for oil from the Organisation for Economic Co-operation and Development (OECD) countries is expected to grow by around 100,000 million bpd in 2024, with OECD Americas accounting for the entire growth, according to OPEC’s September report. Oil demand in non-OECD countries is expected to grow by around 1.9 million bpd this year.
OPEC now sees total oil demand in 2024 at 104.2 million bpd and in 2025 at 105.99 million bpd. "Total world oil demand is anticipated to reach 105.6 million bpd in Oct-Dec 2024, bolstered by strong air travel demand and road mobility, including trucking, as well as healthy industrial, construction and agricultural activities in non-OECD countries," OPEC said.
In August, OPEC's crude oil production fell 197,000 bpd to 26.59 million bpd, according to secondary sources cited by the cartel. Production mainly fell in Libya and Iraq last month. Saudi Arabia, the biggest producer of the group, produced nearly 9.0 million bpd of crude oil last month, down 25,000 bpd from July.
The cartel has forecast growth in oil supply from countries outside of OPEC and allies at 1.2 million bpd, unchanged from the previous estimate. "The main growth drivers are expected to be the US, Canada and Brazil," it said. In 2025, non-OPEC oil supply is expected to grow by 1.1 million bpd, which also remains unchanged from the previous projection. "The growth is anticipated to be mainly driven by the US, Brazil, Canada and Norway."
Crude oil prices plunged by more than $3 per barrel on Tuesday, ending the day below $70 a barrel for the first time since November 2021. The fall in prices came after the Organisation of the Petroleum Exporting Countries (OPEC) and its allies lowered their demand outlook for 2024 and 2025.
The world’s largest oil-producing cartel has lowered its 2024 estimate by 100,000 barrels per day (bpd) to 2 million bpd. The level is still well above the historical average of 1.4 million bpd prior to the Covid pandemic.
In its September Oil Market Report, OPEC has also lowered by 40,000 bpd its previous estimate for 2025. The demand for crude is however seen rising next year to 1.7 million bpd.
India's oil demand in 2024 is seen at 5.61 million bpd, 5% higher than in 2023, OPEC said. In 2025, the country is expected to consume 5.85 million bpd of oil, a growth of 4.3% on a year-on-year basis. Both estimates are marginally up from the previous month's estimates.
Demand for oil from the Organisation for Economic Co-operation and Development (OECD) countries is expected to grow by around 100,000 million bpd in 2024, with OECD Americas accounting for the entire growth, according to OPEC’s September report. Oil demand in non-OECD countries is expected to grow by around 1.9 million bpd this year.
OPEC now sees total oil demand in 2024 at 104.2 million bpd and in 2025 at 105.99 million bpd. "Total world oil demand is anticipated to reach 105.6 million bpd in Oct-Dec 2024, bolstered by strong air travel demand and road mobility, including trucking, as well as healthy industrial, construction and agricultural activities in non-OECD countries," OPEC said.
In August, OPEC's crude oil production fell 197,000 bpd to 26.59 million bpd, according to secondary sources cited by the cartel. Production mainly fell in Libya and Iraq last month. Saudi Arabia, the biggest producer of the group, produced nearly 9.0 million bpd of crude oil last month, down 25,000 bpd from July.
The cartel has forecast growth in oil supply from countries outside of OPEC and allies at 1.2 million bpd, unchanged from the previous estimate. "The main growth drivers are expected to be the US, Canada and Brazil," it said. In 2025, non-OPEC oil supply is expected to grow by 1.1 million bpd, which also remains unchanged from the previous projection. "The growth is anticipated to be mainly driven by the US, Brazil, Canada and Norway."