The supply of crude oil on the market next year will far exceed demand, even assuming that the Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, which form OPEC+, finally lift the restrictions. supply restrictions that have been applying since 2023according to the International Energy Agency (IEA).
In its monthly bulletin for December, the agency attached to the Organization for Economic Cooperation and Development (OECD) points out that The key issue for the market in 2025 will be the evolution of global oil demandgiven the abrupt slowdown in China’s crude oil consumption growth this year and the significantly lower increases in other emerging economies such as Nigeria, Pakistan, Indonesia, South Africa and Argentina.
In this way, in what represents a break with recent trends, Non-OECD oil demand in the third quarter of 2024 rose by just 320,000 barrels a day from the same period a year earlier, its lowest quarterly growth rate since the peak of the pandemic, while non-OECD countries The OECD recorded an increase of 190,000 barrels per day.
In this sense, the IEA foresees that The relatively moderate pace of growth in global oil demand continues in 2025, accelerating only modestly from the increase of 840,000 barrels per day estimated for 2024 to around 1.1 mb/d in 2025, when global consumption is projected at 103.9 mb/d.
In contrast, the IEA anticipates that the total oil supply is on track to increase by 630,000 barrels per day this year and by 1.9 mb/d in 2025, up to 104.8 mb/d, “even in the absence of an elimination of OPEC+ cuts”, since the supply of crude oil from outside the cartel would grow by approximately 1.5 mb/d in both years, led by the United States, Brazil, Guyana, Canada and Argentina.
In its analysis, the agency notes that OPEC+’s recent decision to delay the lifting of its additional voluntary production cuts by three more months and extend the gradual increase period by nine months until September 2026 has materially reduced the potential oversupply. which was expected to emerge next year. Even so, the persistent overproduction of some OPEC+ membersthe solid growth in supply from countries outside this group and the relatively modest growth in global oil demand “leave the market with a prospect of slack in supply in 2025.”
“The latest OPEC+ decision does not eliminate uncertainty about when the elimination of cuts will actually begin,” says the IEA, whose forecasts exclude a return to higher production quotas until a definitive schedule is confirmed. “On that basis, our current market balances still indicate a surplus supply of 950,000 barrels per day in 2025,” estimates the Paris-based agency, underlining that, if OPEC+ begins to eliminate voluntary cuts from the end of March 2025“this surplus would increase to 1.4 mb/d.”
Likewise, he points out that OPEC+ crude oil production can still increase next year if Libya, South Sudan and Sudan are able to maintain production while launching Tengiz’s 260,000 barrels per day expansion in Kazakhstan.
In any case, globally, most supply growth will continue to be dominated by non-OPEC+ countries, with United States, Brazil, Canada, Guyana and Argentina adding more than 1.1 mb/d of crude oil and LNG production.
#IEA #foresees #surplus #oil #market #position #OPEC
