The IEA projects further deceleration in demand growth to 1.2 mb/d in 2024 and 1.1 mb/d in 2025, as the post-COVID rebound subsides and the expansion of the electric vehicle fleet, along with increased vehicle efficiencies, continue to suppress demand.
Conversely, non-OPEC+ nations, led predominantly by the United States, are poised to substantially increase global oil supply. The agency forecasts global output to rise by 770 kb/d to 102.9 mb/d in 2024. Non-OPEC+ production is expected to expand by 1.6 mb/d, while OPEC+ supply could decline by 820 kb/d if the group maintains its voluntary cuts. For 2025, global oil supply is forecast to increase further by 1.6 mb/d, with non-OPEC+ anticipated to contribute a 1.4 mb/d increase, and OPEC+ potentially boosting output by 220 kb/d, contingent on ongoing production restrictions.
Refinery throughputs globally are expected to rise by 1 mb/d to 83.3 mb/d in 2024, although this is 160 kb/d less than earlier predictions, impacted by reduced Russian output, unplanned European outages, and continued subdued activity in China. Throughputs are projected to climb by 830 kb/d to 84.2 mb/d in 2025, with non-OECD growth of 1.1 mb/d expected to offset declines in the OECD.
In inventory trends, global oil inventories increased by 43.3 million barrels in February to reach a seven-month high, with oil on water at its highest level in 15 months. Conversely, on-land stocks dropped to their lowest since at least 2016. OECD industry stocks fell by 7.6 million barrels in February, remaining 65.1 million barrels below the five-year average. Early data suggest an increase of 22 million barrels in March.
Amidst these developments, ICE Brent crude futures touched a six-month high of USD 90 per barrel in early April, driven by escalating Middle East tensions, attacks on Russian refineries, and the extension of OPEC+ output cuts through June. Investor sentiment has bolstered crude’s price strength, with exchange net fund positions in Brent reaching their highest in a year.
The IEA’s report underscores the shifting dynamics in the global oil market, highlighting the significant impact of geopolitical events and policy decisions on oil supply and demand.
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