High-level OPEC officials unveiled the short- to long-term outlook for the organization’s crude oil market at a special meeting in Invest in African Energy forum in Paris on Tuesday.
Based on the latest OPEC Monthly Oil Market Report – released on 14 May – and the World Oil Outlook, the meeting identified key drivers of oil supply and demand growth to 2045, highlighting the role of African and emerging markets in promoting global economic activity.
“We believe in the future of Africa and the South-South – we see almost all global oil demand coming from emerging markets,” said Dr. Ayed Al-Qahtani, Director of the Research Department and OPEC. “We see the global economy at least doubling in size and emerging nations retaining the lion’s share of energy demand in the future. Africa is north of 120 billion barrels of crude, and that can be extended to all commodities – precious metals, natural gas, hydropower, all of the above. The issue of investment is important and prevents the exploitation of these resources which could facilitate enormous potential for economic growth.’
“In the medium term, non-OPEC supply will drive the market – we are looking at adding 7 million barrels of oil per day – from Brazil, Guyana and Canada. However, we expect this supply to peak towards the 2030s. Once it peaks, there will be increased demand on OPEC supply and this demand will grow to around 40% oil market share by 2045,” said Irene Nkem Etiobhio , chief oil industry analyst.
With positive economic growth expected in 2025, the panel shared insights on the role of inflation and various economic, social and geopolitical factors, particularly in the US, in global oil supply and demand.
“We believe that inflation will remain high in 2024 and 2025, but will gradually decline and there will be less need for tight monetary policies. Global economic growth will be 2.8% for 2024 and 2.9% for 2025,” said Behrooz Baikalizadeh, Head of the Petroleum Studies Department.
“We estimate that the US economy will grow by 2.9% in 2024 and by around 1.9% in 2025. Against this backdrop of a strong US economy, inflationary pressures will likely remain and may delay decisions to cut rates. interest rates. The strength of the US economy, combined with inflationary pressures, will likely… lead to high commodity prices,” said Angel Edjang Memba, Senior Financial Analyst.
The panel also highlighted recent developments in refining and trade on the continent and their impact on the price and availability of refined petroleum products. While Africa’s refining capacity has been limited to date, new developments – including Nigeria’s 650,000 bpd Dangote refinery – are reshaping the sector.
“There have been notable changes in global refining capacity with new large-scale refineries coming online… These have contributed to an increase in new product supplies. In the short term, this will put pressure on refining margins, but could also be a good sign for end consumers, where prices are falling with more supply,” said Tona Ndamba, Chief Refinery & Products Analyst.