OPEC’s view on 2018 world oil supply/demand shows growth, optimism

By North American Shale magazine staff | October 20, 2017

The Organization of Petroleum Exporting Countries has taken a positive view of the 2018 global oil supply and demand curve.

“Global economic growth momentum had gained traction lately and has become more balanced, with all major economies now showing positive growth this year, a trend that is forecast to continue into 2018,” OPEC explained in an early fall oil market report.

Part of the growing demand for oil this year and next is due to economic growth expected in several countries. The U.S. and the euorzone should rise in growth by 2 percent next year, OPEC said, with India growing by 7.5 percent next year. Brazil and Russia will rebound and grow at 1.5 percent in 2018 and China will grow at 6.3 percent next year.

The growth in the world’s largest economies will help to offset oil production increases that will take place for OPEC’s total volumes and within the U.S.

For year-end 2017 volumes, OPEC will produce 500,000 barrels of oil per day more than it did in 2016. Volumes for this year will reach 32.7 mb/d. Next year, however, OPEC said it intends to add another 200,000 b/d, bringing its yearly average for 2018 to 32.8 mb/d.

Based on data supplied from OPEC, the U.S. will produce near-record levels this year before surpassing production totals records previously set in 1970 next year. This year, production will round out at 9.3 mb/d and then reach 9.8 mb/d in 2018.

Despite all of the production increases, world demand will surpass supply. Next year, global oil demand growth will rise by just over 1.3mb/d, bringing the world’s daily total to 98.12 mb/d.