The December issue of the World of Petroleum and Bitumen
WPB: Fitch Ratings has predicted that oil demand growth in 2025 will likely be similar to 2023. Slower demand growth compared to 2022 and 2024 is expected to bring the average price of oil down to $70 per barrel.
The average price per barrel of oil in 2024 is estimated to be around $80.
In its report, Fitch stated: “We expect oil prices to decline from an average of $80 per barrel in 2024 to $70 per barrel in 2025 due to slower demand growth and higher production from non-OPEC+ countries, which will lead to an oversupply.”
Fitch also noted that geopolitical tensions pose an upside risk to oil prices. However, OPEC+’s spare production capacity and its ability to manage supply could offset upward pressure on prices.
Earlier in December, OPEC+ decided to delay the start of restoring 2.2 million barrels per day of suspended production, which was initially planned for January 2025. The group has postponed this to April 2025 and slowed the pace of its production recovery, now aiming to fully restore output by September 2026.
According to analysts, OPEC+’s recent decision may result in a smaller surplus in 2025 than previously forecasted, but oversupply is still anticipated.
The International Energy Agency (IEA), in its monthly report, stated that the oil market will face a significant surplus in 2025. Even if OPEC+ maintains its production cuts throughout the year, there will still be a daily oversupply of 950,000 barrels. The IEA’s December market report also indicated that if OPEC+ begins lifting voluntary production cuts in late March 2025, the surplus could grow to 1.4 million barrels per day.
Global oil demand is expected to grow by 1.1 million barrels per day in 2025, reaching 103.9 million barrels per day, according to the IEA.
Recent reports suggest that supply growth has outpaced demand growth. The IEA estimates that even if OPEC+ does not increase production, total global oil supply in 2025 will rise by 1.9 million barrels per day, reaching 104.8 million barrels per day.
By Bitumenmag
Oil, Barrels, Price, Bitumen
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