The unsatisfactory data so far this year, coupled with expectations of slowing demand growth in Asia, has prompted OPEC to lower its forecast for global oil demand growth in the next two years. This is the first time the organization has lowered its forecast for 2024 since releasing its initial forecast a year ago.

OPEC lowers global oil demand forecast

In its monthly Oil Market Report (MOMR) released on Monday, OPEC stated that global oil demand will increase by 2.11 million barrels per day by 2024, which is still a "healthy" growth rate and far above the historical average of 1.4 million barrels per day before the pandemic.

But the latest estimated demand growth is 135000 barrels per day lower than the 2.25 million barrels per day growth estimated in July.

OPEC has also lowered its demand growth forecast for 2025 to 1.78 million barrels per day, slightly lower than the forecast of 1.85 million barrels per day in last month's report.

OPEC stated, "Global growth forecasts are influenced by many uncertain factors, including global economic development

Although OPEC has lowered its forecast for oil demand growth in 2024 for the first time, the gap between OPEC's growth assessment and the International Energy Agency (IEA) still exceeds one million barrels per day.

Institutions claim that the risk of oil price decline is increasing

Commonwealth Bank of Australia (CBA) analyst Vivek Dhar wrote in a report that market conditions may force OPEC+to maintain its voluntary production cuts by the end of the year.

Dhar wrote that due to expected weak demand and US refineries' desire to reduce capacity utilization, the risk of a decline in crude oil demand is increasing. The supply policy of OPEC+is the key to alleviating weak oil demand.

Currently, oil prices have risen above $80. Harry Tchilinguirian, head of research at Onyx Capital group, said, "The geopolitical premium built on expectations of Iran retaliating against Israel can only withstand current prices. The market needs more reliable economic data to support and stabilize

Oil prices rose for the sixth consecutive trading day on Tuesday, continuing the trend of over 3% increase from last week, as concerns about a US economic recession eased and geopolitical tensions in the Middle East supported oil prices.

Dhar expects Brent crude oil futures to trade between $75-85 per barrel in the short term, and there is a risk of upward movement in oil prices for the remainder of this year due to tensions in the Middle East.

Brent crude oil daily chart