Oil demand forecasts in 2023 have become more optimistic, thanks to positive signs about the global economy, led by China, after the cancellation of restrictions related to the Corona epidemic.
And for the first time in 12 months, he raised International Monetary FundAt the end of January 2023, he made his estimates on the growth of the global economy, expecting a GDP growth of 2.9% during the current year (2023), an increase of 0.2% from the previous forecast in October 2022.
The International Energy Agency, OPEC and the US Energy Information Administration raised expectations for oil demand in 2023, in the latest monthly reports issued by the 3 major institutions, which agreed on China’s positive role in supporting global growth this year, according to what was monitored by the Energy Research Unit.
Global demand for oil in 2023
The International Energy Agency has boosted expectations for oil demand this year to two million barrels per day, an increase of 100 thousand barrels per day from January 2023 estimates, so that the total is likely to reach a new record of 101.9 million.
It is expected that the demand for oil in China will grow by 900 thousand barrels per day during the current year, to reach a total of 15.9 million barrels per day.
Likewise, OPEC raised its estimate of global oil demand this year to 2.32 million barrels per day, compared to 2.22 million barrels per day previously forecast.
This means that the total demand for oil may reach the level of 101.87 million barrels per day, compared to 99.55 million barrels per day last year (2022).
The following chart – prepared by the Energy Research Unit – monitors OPEC’s expectations for oil demand growth in major economies during 2023:
For its part, the US Energy Information Administration raised expectations for oil demand in 2023 to 1.11 million barrels per day, compared to previous estimates of 1.05 million barrels per day, which means that the total may reach 100.47 million.
Despite the optimistic outlook, the three major institutions indicated that the outlook is subject to uncertainty in light of the ongoing economic challenges and geopolitical risks.
Oil supply forecasts
Contrary to demand, OPEC cut estimates of non-OPEC oil supply growth to 1.44 million barrels per day in the current year, against a previous forecast of 1.54 million barrels per day, with lower Russian supplies.
This means that the total oil supply from outside OPEC may reach 67.01 million barrels per day this year, compared to 65.57 million barrels per day last year.
The following graph shows OPEC’s expectations for the change in petroleum liquids production for some countries in 2023:
On the other hand, the US Energy Information Administration raised estimates of non-OPEC oil supply growth to 1.24 million barrels per day in 2023, compared to previous expectations of 0.97 million barrels per day, bringing the total to 67.02 million.
For its part, the International Energy Agency expects an increase in global oil supply by 1.2 million barrels per day during 2023, led by the United States and Brazil, noting that supplies may exceed demand during the first half of the year.
This comes despite expectations of a decline in Russian supplies this year, especially after Moscow decided to reduce its production by 500,000 barrels per day, starting next March.
global oil stocks
According to the monthly report of OPEC, commercial oil inventories in the Organization for Economic Cooperation and Development decreased by 10.9 million barrels on a monthly basis during December 2022, to reach the level of 2.768 billion barrels.
Global oil stocks were higher by 117 million barrels, on an annual basis, but about 95 million barrels lower, compared to the average of the past 5 years.
While the Energy Agency estimates showed that oil stocks in the Organization for Economic Cooperation and Development decreased by 18.1 million during the last month of 2022, at 2.767 billion barrels, to be less than the average of the last 5 years by about 95.7 million.
The US Energy Information Administration had indicated that global oil stocks ended last year at 2.783 billion barrels.
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