Oil demand to continue to set records in 2024
Published by Callum O'Reilly,
Senior Editor
Hydrocarbon Engineering,
Global oil demand is due to rise by almost 2 million bpd in 2024, with China accounting for over 25% of that increase according to a report by Wood Mackenzie.
The report, ‘Oil & Chemicals: Five things to watch in 2024’, published in December 2023, states that alongside China, other key markets for growth include three emerging markets in Asia, Indonesia, Vietnam, Thailand, and the US.
“Much of the growth [in oil demand] will be coming in the second half of the year,” said Alan Gelder, Senior Vice President of Research at Wood Mackenzie. “This will be fuelled by improving economic growth and lower interest rates.”
Wood Mackenzie forecasts total oil demand of 103.5 million bpd for 2024.
The report adds that oil supply will lag demand growth as OPEC+ supply cuts slow growth across 2024. However, it adds that without this production restraint the market could tilt into oversupply, especially if demand growth is below expectations.
Refineries will continue to be middle distillates led
With 2024 refining capacity additions set to be modest, the report states that demand growth of 600 000 bpd will be met with high utilisation rates and the successful ramp up of Middle East capacity.
The key factor in any refined product supply outlook is Wood Mackenzie’s assumptions that Nigeria’s Dangote refinery will be ramped up successfully to full capacity of 650 000 bpd by the end of the second quarter of the year.
“As OPEC+ production returns the refinery yield of middle distillates, such as jet and diesel/gasoil, will rise from a heavier global crude slate,” Gelder said. “However, the easing of interest rates and re-balancing of GDP are critical to distillate demand growth.”
Read the article online at: https://www.hydrocarbonengineering.com/refining/16012024/oil-demand-to-continue-to-set-records-in-2024/
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