A recent Bloomberg Intelligence poll showed that forecasts for peak oil demand are 11 years behind their previous peak, with a declining proportion of respondents expecting it to occur before 2035; As 69% of participants in the 2023 survey expect peak demand by 2035, compared to 80% in 2022, while only 24% expect peak demand before 2030.
It is expected that global demand for oil will range between (102-103) million barrels per day on average during the year 2024. The International Energy Agency expects demand this year to reach 103 million barrels per day, while OPEC estimates that the volume of global demand for oil during the current year will reach 104.4 million barrels per day.
The most important factors that will affect global oil supply are:
US crude oil production reached a record level of 13.3 million barrels per day in December 2023, after continued increases in productivity at new wells, and production reached an annual record of 13.21 million barrels per day in 2023.
The strong growth in oil production by producers outside the OPEC+ alliance, especially American shale oil, is one of the biggest pressures on oil prices last year. The following chart shows the production volume of the largest oil producers in the world (Saudi Arabia / the United States / Russia) in… Last decade:
New technology has improved the efficiency of oil exploration in the United States from operating platforms, which has helped increase supplies.
Despite this growth, in its latest report issued in 2024, the Energy Information Administration reduced its expectations for the growth of US oil supply to 170,000 barrels per day, compared to previous estimates of an increase of 290,000 barrels per day.
On March 3, the OPEC+ coalition countries extended voluntary oil supply cuts amounting to about two million barrels per day until the end of June, and Saudi Arabia, which leads the coalition in partnership with Russia, is leading half of the pledged reduction.
S&P Global Commodity Insights expects that coalition members will move to extend oil production cuts until the end of 2024.
Saudi Aramco also announced its adherence to its strategic goals, by maintaining its maximum oil production capacity at 12 million barrels per day, in line with the directives of the Saudi government.
Oil prices have remained in a narrow range ranging between $75 to $85 per barrel since the beginning of the year, despite OPEC+ supply cuts, ongoing Houthi naval attacks in the Red Sea and ongoing geopolitical risks from events in Israel and Hamas. The following chart illustrates this fluctuation:
Russia’s seaborne crude oil exports rose to their highest level this year so far, with the total value of Russian oil exports reaching the highest level since last October. It rose to $1.86 billion from a revised value of $1.53 billion, and Russian seaborne crude oil shipments rose to 3.7 million barrels per day.
The following figure shows the fluctuation of Russian oil exports in the period from (2021-2024):
It is therefore not expected that the imposition of tougher US sanctions will lead to a decline in Russia’s crude oil exports in 2024.
Consequently, expectations for peak oil demand fell by 11 years, and the continued growth of US production puts pressure on oil prices, in addition to the OPEC+ alliance extending production cuts to support prices, and the impact of Western sanctions on Russian oil exports is limited.
The agency is interested in studies of energy security, and its political and geopolitical effects, as well as the effects of energy security on stability in the system and international peace.