Global oil demand growth is expected to moderate next year as the world economy is expected to grow slightly less than this year, OPEC said on Wednesday in its projections for the 2019 demand.
In its closely followed Monthly Oil Market Report, OPEC expects global oil demand to rise by around 1.45 million bpd in 2019, following expected growth of 1.65 million bpd for 2018, with this year’s demand growth assessment unchanged from the previous monthly report from June.
This year, total world oil consumption is expected at 98.85 million bpd, while the annual average global consumption next year is anticipated to surpass the 100 million bpd threshold, OPEC said in today’s report.
“Following the robust growth seen this year, oil market developments are expected to slightly moderate in 2019, with the world economy and global oil demand forecasts to grow slightly less, while non-OPEC supply growth is projected to remain broadly steady,” said the cartel.
Europe is expected to continue see an expansion, albeit at a slower pace, as economic growth projections ease slightly, while Asia-Pacific oil demand is seen weakening in light of planned substitution programs.
“Slightly lower Chinese oil demand growth, compared with 2018, is expected to be offset by higher oil requirements, mainly in Latin America and the Middle East,” according to OPEC.
Demand for OPEC’s crude oil is expected to average 32.2 million bpd in 2019, down by around 800,000 bpd from 2018.
“Therefore, if the world economy performs better than expected, leading to higher growth in crude oil demand, OPEC will continue to have sufficient supply to support oil market stability,” it said.Related: OPEC Won’t Take Additional Action As Oil Prices Rise
Non-OPEC oil supply is expected to grow by 2.1 million bpd year on year in 2019, broadly unchanged from 2018, mainly due to higher production in North America and new project ramp-ups in Brazil, while Mexico, Norway, and China are expected to lead the non-OPEC supply declines on the back of absence of new projects and heavy declines in mature fields.
For U.S. shale growth, OPEC expects it to “slow down considerably” in the second half of this year, and expects this slowdown to continue into 2019 as the Permian faces takeaway capacity constraints.