The US Energy Information Administration (EIA), which released a report on Wednesday evening, said that India is the largest source of global oil consumption growth.
In its November Short Term Energy Outlook, the EIA stated that India will account for 25% of global oil demand growth in 2024 and 2025.
The agency stated that “we expect a global increase in liquid fuel consumption in 2024 of approximately 1.0 million barrels a day.”
The report said that global oil consumption will likely rise by another 1.2 million barrels a day next year.
Global Oil Consumption
According to the US Energy Agency, the projected growth of global oil demand in 2024 and 2025 is below the 10-year average growth of 1.5 million barrels of oil per day before the pandemic.
The growth projected for this year, and next, will be lower than the recovery from the pandemic between 2021-2023.
The majority of growth comes from countries outside of the Organization for Economic Cooperation and Development.
The EIA stated that the oil demand in India is expected to grow by 300,000 barrels a day between 2024 and 2025. The EIA said that this will be due to the rising demand for transportation gasolines.
The agency stated that “we forecast China’s oil and liquid fuels will grow by less 0.1 million B/d in 2024, before recovering to nearly 0.3 million B/d 2025.”
The rapid expansion of electric vehicles in China, the increasing use of liquefied gas for hauling goods and the slowing economic growth has all contributed to a decline in transportation fuel consumption.
Production
The EIA has raised its oil production forecasts for 2024 and 25.
The company expects the global oil production in 2024 to be 102.62 millions barrels a day, a slight increase from its previous estimate which was 102.50.
Production is estimated to be 104.66 millions barrels a day in 2025 compared with 104.54million barrels a day last month.
The agency also raised its estimates for US production.
EIA estimates that US oil production will average 13,23 million barrels per a day by 2024. This is a little higher than the 13.22 million barrels per daily estimated in the October report.
The US oil production will likely reach record levels in 2024, with a forecast of about 300 000 barrels per day more than the 2023 record.
Prices and inventories of oil
EIA predicts that despite recent lower crude oil prices, ongoing withdrawals of global oil inventories as well as increased Middle East tensions will put upward pressure on the prices between January and March 2025.
We estimate that the global oil inventory fell by 0.9 millions barrels per day in 3Q24. And we expect them to fall by an average 0.3 million barrels a day in 4Q24.
The agency said that “as a consequence, we expect that the Brent price will increase from $72/b at the end of November to an average $78/b by the 1Q25.”
The agency also expects that non-OPEC production will increase between April and June 2025, along with the Organization of the Petroleum Exporting Countries (OPEC) and its allies.
The global oil demand is expected to grow faster than the increase in inventories, which will average 400,000 barrels a day between April and June. The second half of the year 2025 is expected to see inventories rise by 600,000 barrels per day on average.
We forecast that the inventory buildup will lead to a downward pressure on crude prices with Brent falling by an average of $74/b for 2H25. “We forecast that the Brent price will average $76/b in 2025,” said the agency.
This post India will drive global oil consumption growth in 2024: EIA first appeared on The ICD
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