Opec sees higher oil demand, for longer

Spanish Market: Crude oil, Petrochemicals
09/10/23

Opec has massively raised its global oil demand forecasts, noting a "pushback against the opinion that the world should see the back of fossil fuels."

Opec secretary general Haitham Al Ghais said "policies and targets for other energies" were faltering "due to costs and a more nuanced understanding of the scale of energy challenges," in the group's latest World Oil Outlook (WOO).

Opec now sees oil demand continuing to grow over the next two decades, reaching 116mn b/d in 2045, from 99.6mn b/d in 2022. And even then it sees a "potential to be even higher."

The latest forecast represents an upwards revision of 6.2mn b/d compared with last year's WOO which had oil demand at 109.8mn b/d in 2045, the same as 2040.

Opec's projections are in stark contrast to those of the IEA which forecast oil demand to peak by 2030 in its medium-term outlook on the oil market back in June.

Opec's forecast reflects the groups belief that oil will play a key role for decades to come, despite growing calls for a ramp down in oil use to help meet climate change goals.

In the medium term, Opec's sees oil demand hitting 110.2mn b/d in 2028, compared with 105mn b/d projected by the IEA. Beyond this, Opec forecasts global demand at 112mn b/d in 2030, 114.4mn b/d in 2035 and 115.4mn b/d in 2040.

The outlook highlights marked differences in oil demand between a developed and developing world. OECD demand grows marginally up to a peak of 46.6mn b/d in 2026 before starting a steady descent from 2028 onwards. By 2045, OECD demand is 9.3mn b/d lower than in 2022.

Opec says this will be mainly driven by energy efficiency improvements and the substitution of oil with electricity and gas. It notes an increased uptake of electric vehicles, the displacement of oil-based heating systems, less oil use in power production and the penetration of alternative fuels in the marine and aviation sectors.

Non-OECD oil demand is expected to grow by 25.7mn b/d between 2022 and 2045, driven by high population growth, an expanding middle class and robust economic growth. While China leads global oil demand growth over the next few years, longer-term India becomes the world's largest single source of incremental demand. By 2045, Indian demand is 6.6mn b/d higher than in 2022, whereas Chinese demand is 3.9mn b/d higher.

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Opec sees global liquids supply rising to 106.3mn b/d in 2025 and 116mn b/d in 2045, compared with 100mn b/d in 2022. Opec liquids production is set to grow by 11.9mn b/d to 46.1mn b/d in 2045, with the group's market share rising from 34pc to 40pc.

Non-Opec liquids supply is expected to grow by 7mn b/d to 72.7mn b/d in 2028, but peak shortly after 2030 at around 73.5mn b/d. But by 2045, supply is projected to fall to 69.9mn b/d as the declines from the US and other mature producers, such as Norway, Mexico, Colombia, the UK and China, fail to offset continuing growth from Canada, Guyana, Argentina, Brazil and Kazakhstan.

Opec says that the world needs to invest $14 trillion in the oil sector up to 2045, split between $11 trillion for the upstream, $1.7 trillion for the downstream and $1.2 trillion for the midstream. This is much higher than the $12.1 trillion forecast last year, with the increase mostly driven by the upwards adjustment to demand projections.

In contrast, the IEA has warned of the "economic and financial risks of major new oil and gas projects," based on its expectations of fossil fuel demand to peak by 2030."Calls to stop investments in new oil projects are misguided and could lead to energy and economic chaos," Opec secretary-general Haitham Al Ghais said.

Opec forecasts energy-related CO2 emissions to "approach a peak sometime around 2030." In 2045 annual energy related CO2 emissions are still seen at 34bn tonnes, only 300mn t below 2022 levels.

By Aydin Calik

OPEC global oil demand forecasts mn b/d

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11/04/25

Recycled resin importers caught in tariff uncertainty

Houston, 11 April (Argus) — US President Donald Trump's evolving tariff policies have created tremendous uncertainty for US importers of recycled polymers, and constant halts and flip-flopping from the administration have led some to pause their US operations. Multiple importers told Argus that the constantly changing US tariffs on goods have upended business plans, and forced them to pause their US operations for the time being due to uncertainty about the taxes their material will face when it reaches US shores. "You have to have some confidence that conditions will hold in order to import," one trader told Argus . Trump's tariff rollout began on 1 February, when he announced that China would face a 10pc universal tariff, and the US's two largest trading partners, Mexico and Canada, would face 25pc universal tariffs. At the time, market participants speculated that the 25pc tariffs on Canada and Mexico would make operations and sales more expensive for Mexican and Canadian recyclers, particularly those that trade bales or finished resin across the US border. After some negotiations between world leaders, the tariffs on Canada and Mexico were delayed for 30 days, though the 10pc tariff on China went into effect as planned. The 25pc universal tariffs on Canada and Mexico were pushed back again on 6 March, but tariffs on aluminum — a significant competitor to rPET packaging — went into place on 12 March. The tariffs on aluminum have not been rescinded or paused, and the extra cost for imported aluminum as a result of the tariff could incentivize US consumer goods companies to use more PET in their packaging. On 9 April, the US put into place varying reciprocal tariffs on a number of countries that export recycled resin to the US, including India, Malaysia and Vietnam. While rPET and vPET pellets were excluded from the reciprocal tariffs, importers of rPE, rPP and PET waste were not excluded from the tariff. The same day, the reciprocal tariffs were pushed back 90 days in favor of a 10pc universal tariff that excludes Canada and Mexico. China and the US's reciprocal tariffs have escalated into a trade war, and currently material from China faces a 145pc tariff. Since the price is too high for most importers to be willing to pay, in essence all recycled resin imports from China are halted. China is one of the largest buyers of US virgin polyethylene https://direct.argusmedia.com/newsandanalysis/article/2675420), and the current trade war with China has the potential to increase domestic supply as exporters are forced to find new buyers for resin. Increased competition from oversupplied virgin resin could pull down recycled resin pricing. Until some stability in tariff policy returns to the US, traders and importers will continue to turn to other destinations outside the US to sell their recycled resin. By Zach Kluver Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Opec+ overproducers cast doubt on compensation pledges

11/04/25

Opec+ overproducers cast doubt on compensation pledges

Output is set to rise in the coming months, with Kazakhstan and Iraq unlikely to live up to commitments to rein in production, writes Aydin Calik London, 11 April (Argus) — The Opec+ alliance's planned production increases in April and May should, in theory, be offset by pledges to compensate for past overproduction, particularly by Kazakhstan and Iraq. But there are few signs that either country will significantly reduce output in the coming weeks. If anything, Kazakhstan has signalled that production will continue at or near record levels of around 1.8mn b/d , putting it some 300,000 b/d above its Opec+ target. Opec+ members subject to targets cut output by 90,000 b/d to 33.93mn b/d in March, according to Argus estimates, but this was still 80,000 b/d above the group's collective crude production target of 33.85mn b/d. The decision by a core group of eight Opec+ members to accelerate the return of 2.2mn b/d of production cuts is a key reason for the recent slide in oil prices, alongside US tariff announcements. But Opec+ has stressed that its implied output increase of 137,000 b/d for April and another 411,000 b/d in May should be cancelled out by compensation-related cuts of 249,000 b/d for April and 309,000 b/d in May. In reality, this is unlikely to happen — the group's output is set to rise. Kazakhstan is the main reason why Opec+ has exceeded its target over the past two months. Kazakh production has surged following a major output increase at the Chevron-led Tengiz field in January — part of the field's future growth project (FGP). Tengiz production rose to a record 901,000 b/d in March, compared with previous levels of 600,000-660,000 b/d. The increase came several months earlier than anticipated, Kazakh officials say, and they have subsequently asked international oil companies that operate Tengiz and the Kashagan oil field to reduce output. But the answer has so far been negative. "Unfortunately, we have not yet agreed with them to the reduction, because for them it is a very challenging action, especially Chevron, [which] spent $50bn on the FGP project. They told us it's not possible for them to reduce [output]," deputy energy minister Alibek Zhamauov said this week. Kazakhstan will try to reduce production from smaller fields operated by domestic producers such as state-controlled Kazmunaigaz, Zhamauov said. But any decrease from these fields will not be enough to offset the rise from Tengiz. Target practice Iraq's output dipped below its 4mn b/d target in March at 3.98mn b/d, but this was still well above the country's effective target of 3.88mn b/d under its compensation plan. If Iraq's past production record is anything to go by, its output is unlikely to fall much further in the months ahead. While Kazakhstan and Iraq are unlikely to see much change in their production, members such as Saudi Arabia and the UAE are set to drive the alliance's output higher. The biggest increase is expected from Saudi Arabia, which will see its 8.98mn b/d target rise by 222,000 b/d by May, offset only marginally by its compensation plans. Riyadh has already signalled that it is preparing to increase production after state-controlled Saudi Aramco cut the official formula price of its May-loading crude exports. The largest cut was for buyers in Asia-Pacific, Saudi Arabia's biggest market. Formula prices can indicate intentions on output, as producers fine-tune how affordable their crude is for marginal refiners. The second-largest production increase is set to come from the UAE, which has long been eager to raise output . The UAE will see its target rise by 103,000 b/d by May, which will also only be offset marginally by its compensation plan. Russia is also scheduled to deliver a significant production increase over the next two months, with its target rising by 105,000 b/d. But all of this increase will be cancelled out if the country sticks to its compensation plan. Opec+ crude production mn b/d Mar Feb* Mar target† ± target Opec 9 21.22 21.36 21.23 -0.01 Non-Opec 9 12.71 12.66 12.62 0.09 Total Opec+ 18 33.93 34.02 33.85 0.08 *revised †includes additional cuts where applicable Opec wellhead production mn b/d Mar Feb* Mar target† ± target Saudi Arabia 8.98 8.93 8.98 0.00 Iraq 3.98 4.05 4.00 -0.02 Kuwait 2.42 2.43 2.41 0.01 UAE 2.91 2.93 2.91 -0.00 Algeria 0.92 0.92 0.91 0.01 Nigeria 1.49 1.58 1.50 -0.01 Congo (Brazzaville) 0.26 0.24 0.28 -0.02 Gabon 0.20 0.22 0.17 0.03 Equatorial Guinea 0.06 0.06 0.07 -0.01 Opec 9 21.22 21.36 21.23 -0.01 Iran 3.34 3.38 na na Libya 1.36 1.39 na na Venezuela 0.87 0.84 na na Total Opec 12^ 26.79 26.97 na na *revised †includes additional cuts where applicable ^Iran, Libya and Venezuela are exempt from production targets Non-Opec crude production mn b/d Mar Feb* Mar target† ± target Russia 8.97 8.96 8.98 -0.01 Oman 0.75 0.75 0.76 -0.01 Azerbaijan 0.47 0.47 0.55 -0.08 Kazakhstan 1.79 1.76 1.47 0.32 Malaysia 0.36 0.36 0.40 -0.04 Bahrain 0.18 0.18 0.20 -0.02 Brunei 0.10 0.09 0.08 0.02 Sudan 0.02 0.02 0.06 -0.04 South Sudan 0.07 0.07 0.12 -0.05 Total non-Opec 12.71 12.66 12.62 0.09 *revised †includes additional cuts where applicable Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US consumer sentiment 2nd lowest on record: Survey

11/04/25

US consumer sentiment 2nd lowest on record: Survey

Houston, 11 April (Argus) — US consumer sentiment fell for a fourth straight month in April, reaching lower levels than during the Great Recession in 2008, as inflation expectations surged to four-decade highs. The preliminary consumer sentiment gauge fell to 50.8 in April, below the 55.3 end-of-month level it reached in November 2008 during the start of the Great Recession, according to the University of Michigan's preliminary reading for April. The only lower reading in records going back to 1952 was in mid-2022 during Covid-19. Year-ahead inflation expectations surged to 6.7pc this month, the highest reading since 1981, from 5pc last month. Sentiment fell by 10.9pc from 57 in March and has lost more than 30pc since December 2024 "... amid growing worries about trade war developments that have oscillated over the course of the year." "Consumers report multiple warning signs that raise the risk of recession: expectations for business conditions, personal finances, incomes, inflation, and labor markets all continued to deteriorate," the survey said. The index of current economic conditions fell to 56.5 in April from 63.8 the prior month. The index of consumer expectations fell to 47.2 this month from 52.6 in March. The proportion of consumers who expect unemployment to rise in the year ahead rose for a fifth month and is more than double the November 2024 result. Interviews for the report were done between 25 March and 8 April, ending prior to the 9 April partial reversal of US tariffs. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

EIA slashes WTI outlook by $7/bl on trade uncertainty

10/04/25

EIA slashes WTI outlook by $7/bl on trade uncertainty

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Norway plans to cut GHGs, but remain oil, gas producer

10/04/25

Norway plans to cut GHGs, but remain oil, gas producer

London, 10 April (Argus) — Norway's government has proposed a greenhouse gas (GHG) emissions reduction of a minimum 70-75pc by 2035, from a 1990 baseline, but has also committed to the country remaining "a stable and predictable supplier of oil and gas produced with low emissions". The government today set out plans for a 2035 GHG reduction target, as well as a wider climate plan for the country. The 2035 GHG reduction targets build on Norway's 2030 goal of "at least" a 55pc reduction in GHGs, again from 1990 levels. Norway has a legislated goal of "a low-emission society" by 2050 — GHG reductions of 90-95pc from the 1990 baseline. Norway's government underlined its commitment to Paris climate agreement goals and phasing out the use of fossil fuels "towards 2050", but also said that it would "not prepare a strategy for the end phase of Norwegian oil and gas". "The government's plan is about phasing out emissions, not industries", it said, noting that Norway is "a significant contributor to Europe's energy security". Norway is the largest producer and only net exporter of oil and gas in Europe. "The government will further develop the petroleum industry and facilitate the future provision of fields… production will continue to be efficient and with low emissions," the government said. It aims for the country's oil and gas sector — the country's highest-emitting industry — to bring emissions from production to net zero in 2050. The bulk of oil and gas emissions are from downstream use — known as scope 3. Norway plans to achieve the majority of its proposed 70-75pc GHG cuts through national measures, including reduced fossil fuel use and both technical and nature-based carbon removals. It also plans to purchase emissions reductions from outside the EU and European Economic Area. This refers to internationally transferred mitigation outcomes (ITMOs) — emission credits — under Article 6 of the Paris climate agreement. Norway's parliament will consider the proposals. Once legislated in the country's climate act, Norway plans to communicate its updated plans to the UN. Signatories to the Paris climate agreement are expected to submit updated climate plans — known as nationally determined contributions (NDCs) — to UN climate body the UNFCCC every five years. The deadline for NDCs setting out climate goals up to 2035 was in February, but many countries have yet to submit plans . By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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