The Organisation of Petroleum Exporting Countries, OPEC, has cut its 2022 forecast for growth in world oil demand for a fourth time since April.
The Organisation also trimmed 2023 figure, citing slowing economies, the resurgence of China’s COVID-19 containment measures and high inflation.
Oil demand will increase by 2.64 million barrels per day (bpd) or 2.7 per cent in 2022, the Organization of the Petroleum Exporting Countries (OPEC) said in a monthly report, down 460,000 bpd from the previous forecast.
The world economy has entered into a time of heightened uncertainty and rising challenges, amid ongoing high inflation levels, monetary tightening by major central banks, high sovereign debt levels in many regions as well as ongoing supply issues,” OPEC said in the report.
The lower demand outlook gives additional context for last week’s move by OPEC and its allies, known as OPEC+, to make their largest cut in output since 2020 to support the market.
The United States criticised the decision, however, on Wednesday, the U.S. Energy Department also lowered its expectations for global output and consumption in 2023.
