OPEC Leaves Oil Demand Estimate Unchanged Despite Impact Delta Variant

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The oil-producing countries united in the oil cartel OPEC are not tampering with the earlier forecasts regarding global oil demand. Not even now that the highly contagious Delta variant of the coronavirus is spreading worldwide, potentially affecting oil demand.

Stricter measures are in force in several countries to prevent infections.

OPEC countries maintain that oil demand will increase by 5.95 million barrels per day this year, a monthly report said. That equates to an increase of 6.6 percent, which is in line with the forecast of a month earlier. Next year, OPEC said that fuel consumption would increase further by an average of 3.3 million barrels per day.

The report does consider the “numerous challenges” facing economies worldwide. But the oil-producing countries also assume that the global economy will continue to recover. OPEC’s forecast is at odds with the energy agency IEA, which revised its forecast earlier on Thursday.

OPEC also raised its forecast for global economic growth this year from 5.5 percent to 5.6 percent. According to the cartel, the impact of the pandemic will remain contained despite “significant uncertainties”. Accordingly, the outlook for 2022 was raised by the same percentage to 4.2 percent.

OPEC countries and allies, including Russia (OPEC+), had previously agreed to cut crude oil production by 10 million barrels per day to prop up prices. That amounted to about 10 percent of global demand. The restrictions were implemented as global energy demand collapsed during the coronavirus crisis.

In the meantime, the countries have gradually increased production. By July, the cut had been reduced to about 5.8 million barrels per day. At a meeting in July, OPEC+ agreed to ramp up production from August further.