OPEC refutes IEA’s oversupply forecast, believes oil demand will continue to grow

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OPEC believes that global oil demand has not yet peaked and predicts it will maintain "strong growth," as governments in the US, Europe, and other regions prioritize energy security and affordability while pursuing climate goals. OPEC stated:

"The growing focus on energy security and energy affordability has changed the global energy policy landscape. In many cases, these shifts reflect that previously ambitious goals and commitments aimed at reducing oil demand are facing reversal, delay, or cancellation."

OPEC pointed out in its annual World Oil Outlook report that global oil demand is expected to grow from an average of 105.1 million barrels per day in 2025 to 113.3 million barrels per day in 2030, and reach 124.1 million barrels per day in 2050.

The organization's optimistic outlook on oil demand stands in stark contrast to other forecasting agencies such as the International Energy Agency (IEA). The IEA predicts that impacted by military conflict between the US, Israel, and Iran, it has revised this year's expected decline in global oil demand upward, with a decrease of 1.1 million barrels per day compared to last year.

As the conflict ends and the Hormuz Strait reopens this week, OPEC member countries such as Kuwait are taking action, planning to rapidly restore oil production to pre-war levels.

Demand Growth Comes from Asia, Africa, and Latin America; US Shale Oil Output Has Peaked

The report shows that the biggest increment in oil demand growth over the coming decades will come from Asia, the Middle East, Africa, and Latin America. Among them, India is the largest contributor, with average daily demand expected to increase by 8.1 million barrels throughout the outlook period.

From an industry perspective, the fastest-growing sectors are expected to be road transportation, petrochemicals, and aviation.

Meanwhile, OPEC stated that US shale oil production peaked in 2025 at just over 9 million barrels per day. The organization said that over the next several years, its competitors can only meet about half of the projected demand growth.

OPEC Secretary General Haitham Al Ghais stated:

"The scale of humanity's energy needs requires continuous investment in all energies and technologies today. For oil alone, from 2026 to 2050, investment as high as $17.7 trillion (i.e., more than $700 billion per year) will be needed to meet long-term demand."

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