Global economic growth will remain strong at 3.1% this and 3.1% next year, OPEC stated Tuesday in a forecast that suggested that the cartel anticipates healthy oil demand growth despite market concerns of a recession.
OPEC did not make any changes to its estimates of economic growth and expressed optimism about the future direction of the global economy in 2022 and 2023.
The cartel projects that the global economy will grow by 3.1% this year and next. Although it has revised its estimation of the Eurozone’s economy, OPEC still expects 3.1% growth in 2022 and a 1.7% rise in the eurozone in 2023. This is contrary to economists and analysts who have predicted that the Eurozone and many EU member states will be in recession as soon as this year. Rising energy prices are weighing on inflation, industry, and consumer sentiment.
“Economies such as India and the Euro-zone had strong growth dynamics in 1H22. This compensated very well for the relative — and possibly temporary — weaker performance by the US and China.”
The cartel pointed out that 2023 has upside potential, despite the obvious downside risks. The EU and China have taken fiscal measures to support growth at the end of the year, which could lead to a stabilizing dynamic in 2023.
OPEC stated that the expected strong economic growth will drive oil demand to continue rising, particularly driven by the recovery of travel and transportation. This will lead to robust growth in oil demand, with 3.1 million barrels per day (BPD) in 2022, and 2.7million BPD in 2023. This surpasses the levels of pre-COVID-19, which is expected to reach 102.7 million BPD next year.
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