Meanwhile, OPEC says it takes a "realistic approach" in its main forecast scenario. Last month, it forecast for the first time that world demand for oil, gas and coal will peak this decade, and dropping by 24 mbd by 2050 due to spectacular growth of cleaner energy technologies and electric cars. The IEA, which is part of the OECD, recently confirmed that it sees no new fossil fuel projects as necessary in the long term. In 2021, the IEA surprised the world and shocked oil exporting nations by calling for a halt in new investment in fossil fuel production to attain carbon neutrality by 2050. "Calls to stop investments in new oil projects are misguided and could lead to energy and economic chaos," he warned, in criticism aimed at the International Energy Agency (IEA). "It is vital that these are made it is beneficial for both producers and consumers," said Al Ghais, a Kuwaiti oil executive. In order to meet this demand OPEC says additional investment in fossil fuel production will be needed, putting the figure at $14 trillion by 2045, or roughly $610 billion per year. Meanwhile, it sees oil demand in the OECD club of advanced economies declining from 2025. "What is clear is that the world will continue to need more energy in the decades to come," he emphasized in the forward to the report-which comes just eight weeks before the next UN climate conference, COP28, in Dubai.Īt the conference dozens of countries will try to impose the adoption of the objective of an end to the use of fossil fuels like oil, natural gas and coal.Īccording to OPEC, whose 13 member states include Saudi Arabia, the Gulf states and Venezuela, oil demand will be driven by emerging and developing nations, with India in pole position. Oil demand has "the potential to be even higher", said OPEC chief Haitham Al Ghais. That is an increase of 6 mbd from its estimate last year. At Sunday's virtual meeting, Opec-plus reiterated its readiness to meet quickly “to address market developments and support the balance of the oil market and its stability if necessary.” Although the October cut decision enraged Washington, recent developments suggest it was the right call as demand concerns mount.In its 2023 annual report, the Organization of the Petroleum Exporting Countries forecasts demand for crude to reach 116 million barrels per day (mbd) by 2045 under its main scenario, a 16.5 percent increase from the 99.4 mbd in 2022. Brent's drop below $80/bbl likely removes one immediate concern for Opec-plus - further releases from the US Strategic Petroleum Reserve. By standing pat, Opec-plus can see how the EU ban and price cap impact Russian volumes, while it gets a better sense of the health of oil demand in the face of recession and the effects of China's retreat from sweeping zero-Covid-19 policies. Benchmark Brent's drop below $80 per barrel this week shows how volatile and unpredictable this oil market can be. The status quo means that Opec-plus' headline 2 million barrel per day cut, announced in early October, will remain in effect for now, but ministers say they can react quickly to market shifts by calling an emergency meeting in the future, if necessary. The producer group's focus now squarely turns to 2023 and events that could swing oil markets in either direction, including a global recession, the reopening of China, and the response of Russian production to EU embargoes and a G7 price cap. Opec-plus' decision this week to keep its current output policy in place and take a "wait and see" approach to supply management is not surprising given the many uncertainties facing oil markets.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |