IEA reduces oil demand growth forecast in 2024, widening gap with OPEC vision

By Natalie Grover

LONDON (Reuters) – The International Energy Agency (IEA) cut its forecast for oil demand growth in 2024 on Wednesday, further widening the gulf between it and oil-producing group OPEC over prospects for oil. global oil demand this year.

The Paris-based energy regulator cut its growth outlook for this year by 140,000 barrels per day (bpd) to 1.1 million bpd, largely citing weak demand in developed OECD countries.

Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) on Tuesday maintained its expectation that global oil demand will increase by 2.25 million barrels per day (bpd) in 2024.

The considerable divide between the two forecasts is due, in part, to different views on the pace of the global transition to cleaner fuels.

The IEA, in its monthly oil report, said its forecast of lower oil demand for 2024 was linked to weak industrial activity and a mild winter that undermined diesel consumption, especially in Europe, where a falling share of cars diesel was already reducing consumption.

“Combined with weak diesel deliveries in the United States at the beginning of the year, this was enough to cause OECD oil demand to contract again in the first quarter,” the IEA said.

The IEA’s oil growth forecast for 2025 of 1.2 million bpd – slightly higher than its previous estimate – is now slightly higher than its projection for this year.

OPEC estimated oil demand growth of 1.85 million bpd for next year.

(Reporting by Natalie Grover and Alex Lawler in London; Editing by Jason Neely)