OPEC said on Tuesday that oil demand in 2022 faced challenges from Russia’s invasion of Ukraine and rising inflation as crude prices soar, but it stopped short of changing its forecast for robust demand this year.
In a monthly report, the Organization of the Petroleum Exporting Countries (OPEC) stuck to its view that world oil demand would rise by 4.15 million barrels per day (bpd) in 2022.
But OPEC said the war in Ukraine and continued concerns about COVID-19 were reshaping the world economy, and it said this would have a negative short-term impact on global growth.
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“Looking ahead, challenges to the global economy – especially regarding the slowdown of economic growth, rising inflation and the ongoing geopolitical turmoil will impact oil demand in various regions,” OPEC said in the report.
“While the year started on relatively solid underlying footing, the latest events in Eastern Europe may derail the recovery,” OPEC said in its commentary on the world economy.
World oil consumption is still expected to surpass the 100 million bpd mark in the third quarter, in line with OPEC’s forecast last month. On an annual basis according to OPEC, the world last used more than 100 million bpd of oil in 2019.
OPEC and its allies, known as OPEC+, are gradually unwinding record output cuts put in place in 2020. At its last meeting, the group swerved the Ukraine crisis and stuck to its previously agreed plan to boost monthly output by 400,000 bpd in April.
The report showed OPEC output in February rose by 440,000 bpd to 28.47 million bpd, exceeding the 254,000 bpd rise that OPEC is allowed under the deal for the first time in 2022.
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