OPEC attributed the recent decline in oil prices to financial market speculators, asserting that market fundamentals remain strong amid what they deemed “exaggerated negative sentiments.” The organization slightly increased its 2023 global oil demand growth forecast, pointing to robust global growth trends and a healthy oil market.
Despite concerns about economic growth, OPEC emphasized strong Chinese imports, minimal downside risks, and a resilient physical oil market. The report noted oil prices dropping to around $82 per barrel for Brent crude, down from a September high of $98, influenced by speculators.
OPEC anticipates 2.46 million barrels per day growth in 2023 and maintains a 2.25 million bpd growth prediction for 2024. The lifting of pandemic lockdowns in China has contributed to increased oil demand.
The report acknowledged OPEC’s increased oil production in October, driven by Iran, Angola, and Nigeria. Iran, exempt from supply cuts due to US sanctions, has boosted output, while Nigeria and Angola recover from internal challenges.
OPEC’s feature article highlighted the underlying strength of the oil market, citing strong crude differentials in October and early November as indicators of market health.