OPEC cuts forecasts of rivals’ supply growth through 2026

OPEC has revised down its forecasts for non-OPEC+ crude supply growth by 100,000 b/d in 2025 and 2026, it said in its monthly oil market report released May 14.

It now estimates non-OPEC+ supply growth at 800,000 b/d in 2025 and 2026, with the bulk of this growth coming from the Americas.

"These forecasts are expected to face some uncertainties, particularly given the ongoing macroeconomic developments across regions," it said.

Growing output among its rivals has been a major challenge for OPEC+ in recent years, with this additional supply undermining the price impact of major OPEC+ supply cuts.

OPEC sees capital spending for oil exploration and production outside OPEC+ countries as falling around 5% year over year in 2025.

"The potential impact on production levels in 2025 and 2026 of the decline in upstream E&P oil investments will constitute a challenge, despite the industry's continued focus on efficiency and productivity improvements," OPEC said.

Demand dynamics

OPEC raised its estimated "call" on OPEC+ crude -- the quantity it must produce to balance supply and demand -- by 100,000 b/d for 2025 and 2026 to 42.6 million b/d and 42.9 million b/d, respectively.

It maintained its forecasts for global oil demand growth at 1.3 million b/d in 2025 and 2026.

This follows a 155,000 b/d cut in demand growth forecasts for the two years in its April report, as US President Donald Trump's trade policy and response measures hit market sentiment.

Since then, the US and China have agreed to cut some reciprocal tariffs and the US has increased sanctions pressure on Iran – raising the likelihood of a fall in Iranian oil exports.

Prices remain below many OPEC producers' fiscal breakeven oil prices, however. Platts assessed Dated Brent at $66.08/b on May 13.

OPEC said that OPEC+ crude oil production fell by 106,000 b/d month month over month in April to 40.92 million b/d, as assessed by secondary sources used by OPEC to estimate crude production. Platts is one of these secondary sources.

Output fell despite quota increases that came into force in April as countries implementing 2.2 million b/d of voluntary crude output cuts began gradually phasing them out.

The group, which includes Saudi Arabia, Russia, Algeria, Kuwait, Kazakhstan, the UAE, Iraq and Oman, have also agreed to accelerate quota increases in May and June.

OPEC cited "healthy market fundamentals" as behind these decisions.

Analysts have interpreted the move as confirmation of a shift in strategy from supporting prices to defending market share.

OPEC said that OECD commercial crude inventories were 139 million barrels less than the 2015-2019 average in March at 1.322 billion barrels, according to preliminary data.