OPEC will need to maintain current supply levels to meet demand for its crude for the rest of this year but could ease up on the taps in 2019, according to the cartel's own analysis.
In its Oct. 11 monthly oil market report, OPEC slightly lowered its global demand estimate for its crude oil to 32.7 million barrels per day this year, down 0.8 MMbbl/d from 2017 levels. The call on OPEC crude is expected to drop to 31.8 MMbbl/d in 2019.
This compares to OPEC's first-quarter production of 32.4 MMbbl/d, second-quarter output of 32.2 MMbbl/d and third-quarter production of 32.6 MMbbl/d, according to secondary sources used to track member output. In September, OPEC crude oil production increased to an estimated average of 32.76 MMbbl/d.
OPEC slightly lowered its expectation for yearly oil demand growth for both 2018 and 2019, while also hiking its projection for non-OPEC supply growth for the year. Non-OPEC supply is expected to average 59.77 MMbbl/d in 2018 and 61.89 MMbbl/d for 2019.
Global oil demand is projected to average 98.79 MMbbl/d in 2018, and is likely to surpass 100 MMbbl/d for the first time ever in 2019, reaching 100.15 MMbbl/d.
In August, the Organisation for Economic Co-operation and Development commercial oil stocks totaled 2.84 billion barrels, which is 165 million barrels lower than the same time one year ago and 47 million barrels below the latest five-year average.
Fears of tightening supply due to the reinstatement of U.S. sanctions against Iran starting in November prompted OPEC and its 10 allies to agree in June to reduce over-compliance with their cut and increase output by 1 MMbbl/d over the ensuing months.