IEA's Shocking Revelation: Oil Demand Outlook Takes a Hit, Despite Predictions of Record Highs

France: International Energy Agency (IEA) has recently revised its global oil demand forecast for the year. Based on market trends and current government policies, the IEA predicts a rise in global oil demand by 6% between 2022 and 2028, to reach 105.7 million barrels per day (mb/d). This increase in demand is primarily supported by robust demand from the petrochemical and aviation sectors. Despite the expected rise in demand, growth in global oil demand is set to slow significantly by 2028, with oil use for transportation projected to decline after 2026. Nonetheless, overall consumption is still expected to be supported by other sectors. The June edition of the IEA's Oil Market Report raised its global oil demand forecast upward from the previous forecast.

The International Energy Agency (IEA) has revised down its forecast for oil demand growth this year due to "persistent macroeconomic headwinds." However, the organization still expects global consumption to reach a record 102.1 million barrels per day. The IEA estimates that global oil demand will grow by 2.2 million barrels per day in 2023, and China is expected to account for much of the growth, while OECD consumption remains stagnant. The agency forecasts a slowdown in global oil demand growth to 1.1 million barrels per day in 2024. Long-term global oil demand has decreased by 2.5 million barrels per day due to the impact of COVID-19 on the global economy and consumer behaviour.

2028, there is an anticipated significant slowdown in the growth of global oil demand. The report forecasts that overall global oil consumption will be supported by robust demand from the petrochemical and aviation sectors, despite a decline in oil use for transport after 2026. However, the continuous growth in global oil demand is coming under pressure due to a challenging economic environment, including the tightening of monetary policy in many advanced and developing countries. The report also suggests that greater adoption of vehicle electrification and efficiency measures would further weigh on oil demand. Meanwhile, international Brent crude oil prices have risen above USD 80/bbl for the first time in more than two months, driven by the prospect of rising demand, particularly from China.

The International Energy Agency (IEA) was established within the framework of the Organisation for Economic Co-operation and Development (OECD). Its mandate includes providing data and statistics on the global oil market and energy sector, promoting energy savings and conservation, and fostering international technical collaboration on innovation and research. Additionally, the IEA coordinates the use of oil reserves held by its members as required by their agreements. With a wealth of knowledge and expertise, the IEA remains at the forefront of shaping the world's energy policies towards a sustainable and secure future.