Global oil demand to rise 1.9M bbl/day in 2024, led by Asia, WoodMac forecasts

Global oil demand will rise by 1.9M bbl/day this year, with the Asia-Pacific region accounting for more than 60% of the total, Wood Mackenzie said Thursday in a forecast close to OPEC’s recent estimate.

Woodmac’s VP of oils research Alan Gelder predicted China and India will account for 496K bbl/day and 161K bbl/day of the growth, respectively, while Asia-Pacific countries excluding China and India will account for 542K bbl/day of the increased demand.

The region’s robust growth contrasts with Europe, where Woodmac sees oil demand declining by 44K bbl/day this year due to weak economic growth.

The consultancy’s outlook ranks slightly below the relatively strong demand growth of 2.25M bbl/day projected by OPEC+, while the International Energy Agency foresees much slower growth of 1.22M bbl/day.

Woodmac’s forecast for demand growth in 2025 turns lower at 1.4M bbl/day while OPEC+ expects growth of 1.85M bbl/day in 2025, while the IEA has not yet revealed its 2025 prediction.

OPEC+ members likely will be asked to increase volumes to balance the market in 2024 despite November’s agreement on voluntary cuts totaling 2.2M bbl/day for Q2, Woodmac’s Gelder said, adding he assumes the cuts will be kept in place through Q2.

Crude oil futures inched lower Thursday but clinched their second straight monthly gain, which have pushed prices to the upper end of this year’s tight trading band, supported by supply cuts from OPEC+, which are widely expected to extend into Q2.

Front-month Nymex crude (CL1:COM) for April delivery closed -0.3% to $78.26/bbl on Thursday while front-month April Brent crude (CO1:COM) settled -0.1% to $83.62/bbl; for the month of February, Nymex crude ended up 3.2% and Brent gained 2.3%.

ETFs: (NYSEARCA:USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI)