Total crude oil production in the Organization of Petroleum Exporting Countries (OPEC) climbed by 73,000 barrels per day (bpd) in December, to an average of 26.7 million bpd, according to OPEC’s monthly oil market report, which was issued on Wednesday.
Nigeria and Iraq experienced output rises, adding 100,000 and 23,000 bpd, respectively. However, reductions in Kuwait, Saudi Arabia, and Iran countered these increases, with output falling by 23,000 bpd, 11,000 bpd, and 12,000 bpd, respectively.
OPEC’s share of world oil output increased by 0.2 percentage points to 26.5% in December, despite an overall decline in global oil supply. Preliminary statistics suggested that worldwide liquids output decreased by 400,000 bpd, averaging 100.9 million bpd.
Non-OPEC liquids output, largely from Russia and the United States, fell by 500,000 bpd to an average of 74.2 million bpd. This decrease was somewhat offset by gains in Other Eurasia and Canada.
The overall global rig count in December was 1,803, a drop of 62 from October. OPEC nations accounted for 420 of these rigs, resulting in a 19-rig drop, while non-OPEC countries deactivated 43.
The OPEC group’s prognosis for global oil demand growth in 2024 stays constant, at more than 2.2 million bpd, from the previous month’s estimate.
This growth is anticipated to be driven by non-OECD countries contributing about 2 million bpd and OECD countries contributing around 300,000 bpd. In the first quarter of 2024, oil demand is expected to grow by 2 million bpd year-over-year, leading to a total world oil demand of 104.4 million bpd.
Strong demand for air travel, robust road mobility—including on-road diesel and trucking—as well as healthy industrial, building, and agricultural activity—particularly in non-OECD countries—all contribute to the increase in demand.
Capacity additions and petrochemical margins in non-OECD countries, mostly in China and the Middle East, are expected to contribute to oil demand growth. For 2025, the report forecasts robust growth of 1.8 million bpd year-over-year.
The non-OECD region is expected to contribute 1.7 million bpd and the OECD is forecast to add 100,000 bpd to this growth. The report, however, warns of uncertainties that could impact these forecasts, including global economic trends.
China is expected to lead global oil demand in 2024. Despite an expected easing in China’s GDP growth compared to 2023, oil demand is anticipated to be supported by sustained healthy activities in the services sector, a recovery in manufacturing activity, and more demand in the petrochemical sector.
The lifting of the ban on overseas group tours in China is expected to further boost international air travel, enhancing jet fuel demand.
The petrochemical industry’s expansion, particularly with the start of the Yulong Petrochemical Plant’s refining complex, is expected to bolster demand for naphtha and other petrochemical feedstocks. Overall, China’s oil demand is anticipated to expand by 630,000 bpd year-over-year in 2024.
