OPEC sees oil demand continuing to rise until 2050 – Commerzbank

OPEC published its long-term outlook for the oil market up to 2050 this week, Commerzbank’s commodity analyst Carsten Fritsch notes.

Demand forecast is likely to prove too high

“It shows that OPEC is convinced that oil demand will increase until the middle of the century. At that point, global consumption is expected to reach 120.1 million barrels per day. At the end of this decade, OPEC expects demand to reach 112.3 million barrels per day.”

“OPEC’s forecast is thus more than 6 million barrels per day higher than that of the IEA, which expects demand to start falling after 2029. OPEC assumes that e-mobility will advance at a much slower rate than the IEA. The total number of vehicles is expected to increase from 1.2 billion in 2023 to 2.9 billion in 2050.”

“Of these, 70% are still expected to have an internal combustion engine. OPEC sees obstacles for electric vehicles in the power grids, battery production capacities and access to critical minerals. Thus, OPEC’s demand forecast depends on its assumption for EV sales. If these rise faster than OPEC assumes, the demand forecast is likely to prove too high.”