OPEC lowers oil demand growth forecast; raises supply estimates

The Organization of Petroleum Exporting Countries (OPEC) on Monday lowered its projections for oil demand growth for this year and the next by 20,000 barrels per day (bpd).

In its latest monthly oil market report, the producers group said expects demand growth to increase by 1.64 million bpd, down from 1.65 million bpd forecast in its July report.

Total oil demand is anticipated to reach 98.83 million bpd.

For 2019, world oil demand is now forecast to grow by 1.43 million bpd, down from 1.45 million bpd growth estimate last month.

The cartel revised upwards its estimates on oil supply for both 2018 and 2019.

Non-OPEC oil supply in 2018 was revised up by 73,000 bpd from the previous report to average 59.62 miliion bpd.

“The main reason for this upward revision was an adjustment for the Chinese supply forecast due to the higher-than-expected oil output in H1 2018,” OPEC said.

Non-OPEC oil supply in 2019 is now projected to reach an average of 61.75 million bpd, indicating an upward revision of 106,000 bpd, mostly due to a re-assessment of the Chinese supply forecast for the next year.

OPEC NGL production in 2018 and 2019 is expected to grow by 120,000 bpd and 110,000 bpd to average 6.36 million bpd and 6.47 million bpd, respectively.

Meanwhile, OPEC production increased by 41,000 bpd to average 32.32 million bpd in July, according to secondary sources, the report said.

Crude oil output increased mostly in Kuwait, Nigeria, the UAE and Iraq, while production showed declined in Libya, Iran, Saudi Arabia and Venezuela, the report said.

Based on data from secondary sources, Saudi Arabia’s production fell 52,800 bpd in July to 10.387 million bpd.

According to direct communication, the Kingdom’s crude oil production declined 200,500 bpd in July to 10.288 million bpd.

“The share of OPEC crude oil in total global production decreased by 0.2 percentage points to 32.8 percent in July, compared with the previous month,” the report said.

Write to Nadeshda Zareen at nadeshda.zareen@argaamplus.com