OPEC lowers oil demand expectations, signaling economic slowdown

The Organization of the Petroleum Exporting Countries (OPEC) stated in its April monthly report that it expects global oil demand to increase by 1.3 million barrels per day in 2025 and 1.28 million barrels per day in 2026, with both forecasts lowered by 150000 barrels per day compared to the previous month. This is the first time OPEC has adjusted its demand growth outlook since December 2024.

This round of price cuts is mainly due to two factors: the new round of trade tariffs imposed by the United States on major Asian countries, and the global economic data for the first quarter of 2025 not meeting expectations. These factors exacerbate the uncertainty of the global economic outlook.

The global economy showed a stable growth trend at the beginning of the year, however, recent trade-related developments have brought greater uncertainty to the short-term global economic growth prospects. "- OPEC Monthly Report

Oil prices under pressure, Brent crude oil still falls by over 10%

Affected by trade concerns and OPEC+production expectations, international oil prices have been under sustained pressure recently. Despite a slight rebound in oil prices following the announcement of partial tariff exemptions in the United States, Brent crude oil is still trading around $66, with a cumulative decline of over 10% so far this month.

OPEC's economic growth expectations tend to be conservative

In terms of economic outlook, OPEC has also made corresponding adjustments. The organization has lowered its global economic growth forecast from 3.1% to 3.0% in 2025 and from 3.2% to 3.1% in 2026. This reflects OPEC's prediction of a slowdown in economic activity in the coming quarters.

On the contrary, according to market research, the International Energy Agency (IEA) has long held a more conservative view on oil demand, expecting global oil use to peak within this decade, while OPEC still insists that demand will continue to grow in the coming years.

OPEC+production differentiation, Kazakhstan once again overproduction

Although OPEC+'s overall production in March decreased by 37000 barrels per day to 41.02 million barrels per day, mainly due to production cuts in Iraq and Nigeria, some member countries still failed to strictly comply with their quotas.

Among them, Kazakhstan's production exceeded the quota for the second consecutive month, increasing by 37000 barrels per day to 1.852 million barrels per day in March, significantly higher than the quota of 1.468 million barrels per day set from January to March.

Kazakhstan will begin fulfilling its commitments in April to partially offset its previous overproduction behavior. "- Kazakhstan's Ministry of Energy statement

The Ministry of Energy of the country stated that although the production in the first two weeks of April 2025 decreased compared to March, it still exceeded the limit allowed by OPEC+, indicating that there are still difficulties in implementing coordinated production cuts.

Editor's viewpoint:

OPEC's downward adjustment of demand forecast this time sends multiple signals: on the one hand, trade concerns caused by US tariff policies have put pressure on global energy demand;

On the other hand, despite the ongoing supply-demand game in the crude oil market, OPEC remains optimistic about long-term demand. The continued overproduction behavior of member countries such as Kazakhstan also adds variables to the overall coordination of OPEC+. If the subsequent economic data continues to be weak, it may push OPEC to re-examine its production strategy at the next meeting.