ABU DHABI — OPEC has raised its medium- to long-term global oil demand forecast in its annual outlook released on Monday, saying $12.1 trillion in investment will be needed to meet this demand despite the energy transition. .
The Organization of the Petroleum Exporting Countries’ 2022 World Oil Outlook view contrasts with that of other forecasters who see oil demand peaking by 2030 due to the rise of renewable energy and electric vehicles.
Growth in oil demand over the next decade will be a boost for OPEC, whose 13 member countries depend on oil revenues. The group has argued that oil should be part of the energy transition and underinvestment is exacerbated as investors focus on economic, social and governance (ESG) issues.
“Total investment in the oil sector will reach $12.1 trillion by 2045,” OPEC Secretary-General Haitham Al-Ghais said in the foreword to the report, saying the figure was up from last year’s estimates. . “However, the chronic underinvestment in the global oil industry in recent years, driven by policies centered around the industry downturn, the COVID-19 pandemic and the end of funding for fossil fuel projects, is a major concern. is the cause.”
OPEC said it would make the shift in 2020 when the pandemic hit demand, eventually slowing down after years of forecasting higher consumption. In the report, OPEC maintains its view that global demand will plateau after 2035.
Other forecasts by companies and banks predict an earlier peak in oil demand. The International Energy Agency said Thursday that for the first time in its modeling history, demand for all fossil fuels will peak, while oil demand will level off over the next decade.
Growing demand for energy security
According to the report, global oil demand will reach 103 million barrels per day in 2023, an increase of 2.7 million bpd from 2022. Gross demand in 2023 will increase by 1.4 million bpd from last year’s forecast.
OPEC also raised its medium-term demand forecast to 2027, saying that figure would increase by almost 2 million bpd by the end of the period from last year. It said the upward revision reflected a stronger recovery to be seen in 2022 and 2023 and a “strong focus on energy security issues” as the replacement of oil by other fuels such as natural gas slows. .
By 2030, OPEC expects global demand to rise to an average of 108.3 million bpd from 2021, raising the 2045 figure to 109.8 million bpd from 2021’s 108.2 million bpd .
OPEC and its ally OPEC+ are again cutting supply to support the market. The report sees his OPEC output in 2027 lower than in 2022 as non-OPEC supply rises, and supply restraint will continue in the medium term.
Still, OPEC remains optimistic about the outlook thereafter, confirming its market share is rising. US tight crude oil supplies are expected to peak after the late 2020s, rather than around 2030 as he did last year. “Oil is expected to remain the number one fuel in the global primary energy mix,” said the report.
Alex Lawler
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