OPEC boosts 2026 oil demand outlook, trims rival supply growth
OPEC Adjusts 2026 Outlook, Tightening Supply and Boosting Demand
World oil demand is projected to climb by 1.38 million barrels per day (bpd) in 2026, a jump of 100,000 bpd from the prior forecast. The agency maintained the 2025 expectation unchanged, positioning the update at the upper end of industry ranges.
OPEC trimmed its estimate for non‑OPEC+ supply growth by the same amount, underscoring a tighter market that could ease the path for OPEC+ to re‑pump barrels and recapture market share after a decade of cuts.
Key Highlights from the Monthly Report
- Demand Growth 2026: 1.38 m bpd, up 100 k bpd vs. previous forecast.
- Supply Growth Outside OPEC+: cut by 100 k bpd.
- World Economic Growth 2025: slight increase to 3.0 %.
- Energy Transition Outlook: OPEC expects a slower shift compared to IEA, which forecasts a 700 k bpd rise.
Market Reaction
Following the release, Brent crude trade steadied near $66 a barrel, after reaching a four‑year low of $58 in April.
Strategic Context
OPEC’s updated figures reflect confidence in global growth resilience, supported by favorable trade deals in the U.S., and robust performance from India, China and Brazil. The agency noted that early 2025 economic data confirm the persistent vigor of global expansion despite trade tensions and geopolitical uncertainties.
U.S. SHALE TO DROP IN 2026
Oil Prices Sway as OPEC+ Boosts Output, U.S. Tariffs Loom
Market Sentiment shrank this year, with falling oil prices driven partly by OPEC+ output hikes and growing worries about U.S. trade tariffs. Analysts note the slump is tightening the economics of U.S. shale production.
OPEC+ Shift to Higher Output
- OPEC+ has decided to raise production after years of supporting the market with cuts.
- Part of the strategy is to absorb U.S. shale output that has seen rapid growth.
2026 Forecast for U.S. Tight Oil
OPEC’s Tuesday report projects a 100,000 bpd decline in U.S. tight oil in 2026, sharply contrasting last month’s outlook for flat output year‑on‑year.
Key assumptions for the 2026 forecast include:
- Continued capital discipline
- Additional drilling and completion efficiency gains
- Weaker momentum in drilling activities
- Increased associated gas production in major shale oil regions
Non‑OPEC+ Supply Outlook
OPEC now expects overall oil supply from countries outside OPEC+ to rise to about 630,000 bpd in 2026, down from last month’s 730,000 bpd forecast.
U.S. Production Growth Expectations
While the U.S. remains a key driver of global supply growth, OPEC now forecasts U.S. total oil output to climb by roughly 130,000 bpd next year, a significant drop from the January forecast of 510,000 bpd.
July Hike Update
In July, OPEC+ added 335,000 bpd to crude output, slightly below the 411,000 bpd hike that the group had called for under its July quota increases.
IEA Forecast Report Wednesday
Both OPEC+ and the IEA are expected to release their latest forecasts on Wednesday.
