OPEC raises 2026 oil demand forecast on economic optimism

OPEC revised its oil demand growth estimate for 2026 upward due to "supportive economic activities," it said in its monthly oil market report released Aug. 12.

The producer group now sees global oil demand growing to 1.4 million b/d in 2026, up 100,000 b/d compared to the previous month's forecast. Its forecast for 2025 remains unchanged at 1.3 million b/d.

Optimism about demand for OPEC+ crude is also growing. It now sees the "call" on OPEC+ crude – the quantity the alliance must produce to balance the market – growing to 43.1 million b/d in 2026, an upward revision of 200,000 b/d compared to last month's forecast.

This update comes alongside a downward revision to estimates for non-OPEC+ supply growth in 2026 by 100,000 b/d to around 600,000 b/d.

Its 2025 non-OPEC+ crude supply estimate remains unchanged at 800,000 b/d.

OPEC sees most of this growth coming from the Americas, with the US, Brazil, Canada and Argentina boosting output.

OPEC+ crude oil output increased by 335,000 b/d in July to average around 41.94 million b/d, according to the available secondary sources, including Platts.

OPEC maintained its estimate for the call on OPEC+ crude in 2025 at 42.5 million b/d.

Economic optimism

Increased optimism about the global economy has underpinned the revisions.

"The global economy is expected to maintain its stable growth trajectory, as supported by the consistent and strong momentum observed in the first half of 2025," OPEC said.

In the months following US President Donald Trump's return to office, forecasts for economic growth and oil demand were grim as he announced major tariffs and global partners threatened to respond. These concerns have somewhat receded as negotiations on reducing tariffs have been partially successful, driving oil prices upward.

Dated Brent has recovered from a 2025 low of $61.09/b on May 7 to $68.07/b on Aug. 11. Prices were as high as $80.435/b on June 19 during the Israel-Iran conflict.

OPEC sees global economic growth at 3% in 2025 and 3.1% in 2026.

Lower stocks

The producer group also noted persistently low crude inventories, with officials pointing out that the market remains in backwardation through 2025, suggesting strong near-term demand.

OPEC said preliminary June data showed that OECD commercial inventories stood at 2.789 billion barrels, down 3.2 million barrels month over month and 91.7 million barrels lower than the latest five-year average.

Stocks included 1.348 billion barrels of crude, 47.3 million barrels below the latest five-year average and down 9.6 million barrels from May levels.

OPEC consistently points to low inventories as a key factor in decisions by eight producers implementing 2.2 million b/d of voluntary crude production cuts to accelerate phasing these out. According to the group's latest announcement, they will complete this process in September.

Commitments to compensate for overproduction since the beginning of 2024 are to some extent offsetting cut easing. Seven of the eight producers – Saudi Arabia, Russia, the UAE, Iraq, Kazakhstan, Oman and Kuwait committed to compensate. The other member of the group, Algeria, has consistently stuck to its quotas, according to the last published compensation plans released by the OPEC Secretariat in April. These plans are updated on a monthly basis, with OPEC stating that the next deadline for submission of revised compensation plans is Aug. 18.

The voluntary cutters will continue to meet monthly to review market conditions, conformity and compensation, with the next meeting scheduled for Sept. 7, OPEC said previously.