The Organization of the Petroleum Exporting Countries (OPEC) has projected a global oil demand growth rate of 1.4 million barrels per day (mb/d) for 2025, with a similar increase expected in 2026.
Released in its January 2025 Monthly Oil Market Report, the forecast reflects robust global economic expansion, with key drivers including rising transportation fuel requirements and sustained industrial activity, particularly in non-OECD regions like China and India. OPEC’s report Highlighted a disparity in demand growth between OECD and non-OECD regions.
“Non-OECD oil demand is expected to witness growth of around 1.3 mb/d, mostly in India, China, Other Asia, the Middle East, and Latin America.
“These regions continue to see economic expansion and increased energy consumption, fueled by urbanization, industrial development, and rising vehicle ownership.”
Organization of the Petroleum Exporting Countries (OPEC)
Global economic growth, forecasted at 3.1% for 2025 and 3.2% for 2026, forms the foundation of OPEC’s oil demand projections. According to the report, steady growth in major economies, including the United States, the Eurozone, and Japan, combined with robust expansion in non-OECD economies like China and India, will drive the demand for energy.
“Inflation normalization will support adjustments in monetary policies, fostering a stable environment for sustained economic recovery.
“Growth in the services sector and a gradual rebound in the industrial sector are also expected to contribute to increased oil consumption.”
Organization of the Petroleum Exporting Countries (OPEC)
The report also underscores the role of aviation fuel, with increasing global air travel contributing to higher jet fuel consumption as the industry recovers from pandemic-related disruptions.
Non-OPEC Supply Growth
On the supply side, OPEC projected non-OPEC liquids production to grow by 1.1 mb/d annually in both 2025 and 2026.
Despite the anticipated increase in non-OPEC supply, OPEC reported a decline in crude oil production among countries participating in the Declaration of Cooperation (DoC). “In December 2024, production dropped by 14,000 barrels per day (tb/d) to an average of 40.65 mb/d,” the report revealed.
The global oil market continues to face significant challenges due to geopolitical tensions and supply disruptions. Ongoing conflicts in the Middle East, coupled with U.S. sanctions on Russia and Iran, have distorted oil supplies and created uncertainties in the market.
These factors complicate the ability of producers to maintain stable output levels and exacerbate volatility in oil prices.
Balancing Energy Needs and Sustainability
OPEC’s report also highlighted the ongoing transition toward cleaner energy, with many nations striving to balance their energy needs with environmental commitments.
“While demand for oil remains strong, the organization acknowledged the growing influence of renewable energy sources and energy efficiency measures on long-term demand trends.”
Organization of the Petroleum Exporting Countries (OPEC)
Countries like China and India are pursuing ambitious renewable energy goals while expanding petrochemical and transportation infrastructure, reflecting the dual priorities of energy security and sustainability.
Similarly, OECD countries continue to invest in electric vehicles and green technologies, potentially tempering oil demand growth over the long term.
OPEC’s projections for steady oil demand growth in 2025 and 2026 offer a cautiously optimistic view of the global energy landscape.
However, OPEC emphasized the need for producers to remain agile in navigating market uncertainties, including geopolitical risks, inflationary pressures, and evolving energy policies.
For oil-exporting countries, the forecast underscores the importance of diversifying economies and exploring opportunities in renewable energy to complement traditional oil revenues. For consumer nations, it reinforces the urgency of balancing energy security with the global shift toward cleaner energy sources.
As OPEC’s projections indicate, global oil demand is poised for steady growth in the coming years, driven by economic expansion and robust energy consumption in non-OECD regions. However, geopolitical tensions and the accelerating energy transition present significant challenges and opportunities for the oil industry.
Producers and policymakers must collaborate to ensure stable and sustainable energy supplies while preparing for a future shaped by both traditional and renewable energy sources.
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