OPEC Maintains 2026 Oil Demand Outlook
Organization of the Petroleum Exporting Countries has maintained its global oil demand growth forecast for 2026 while cautioning that ongoing geopolitical tensions and supply disruptions in the Middle East continue to tighten crude markets and sustain volatility in global energy prices.
In its May Monthly Oil Market Report, OPEC projected that global oil demand would increase by 1.2 million barrels per day in 2026, with demand growth expected to accelerate further to 1.5 million barrels per day in 2027.
The producer group also retained its global economic growth projections at 3.1 per cent for 2026 and 3.2 per cent for 2027, citing resilient economic activity in major emerging markets and improving global trade conditions.
According to the report, strong economic growth across Asia, increased investment linked to artificial intelligence and continued expansion in international trade are expected to support oil consumption despite persistent inflationary pressures and geopolitical uncertainty.
OPEC noted that physical oil markets remained relatively tight during April as refiners in Europe and Asia competed aggressively for immediate crude cargoes following disruptions to Middle Eastern supply flows.
The report indicated that the OPEC Reference Basket declined by $7.57 per barrel month-on-month to average $108.79 per barrel, while Brent Crude averaged $102.46 per barrel during the period under review.
OPEC further observed that physical crude markets appeared tighter than futures markets suggested, with both Brent and West Texas Intermediate forward curves moving deeper into backwardation, a market structure often associated with short-term supply shortages and immediate demand pressure.
The report also highlighted persistent disruptions affecting global shipping and crude trade routes, particularly along key maritime corridors linked to the Middle East.
According to OPEC, freight rates for Very Large Crude Carriers operating on the West Africa-to-East trade route remained 129 per cent higher than levels recorded a year earlier, although rates had eased slightly from peaks observed in March.
Meanwhile, crude exports from the United States reached a record 5.3 million barrels per day in April, supported by increased shipments to Japan and South Korea as buyers sought alternatives to Middle Eastern crude supplies.
OPEC also signaled weaker supply growth from countries outside the Declaration of Cooperation alliance, commonly referred to as OPEC+.
The organisation projected that non-Declaration of Cooperation countries would increase liquids production by approximately 600,000 barrels per day in both 2026 and 2027, with Brazil, Canada, Argentina and Qatar expected to lead production gains.
The report additionally pointed to declining upstream investment among non-OPEC+ producers. Capital expenditure on oil exploration and production in non-DoC countries reportedly fell by about $8 billion in 2025 to $281 billion and is projected to decline by another five per cent in 2026.
In the United States, upstream liquids investment is estimated to have dropped seven per cent in 2025 and is expected to decline by a further 12 per cent this year as shale oil producers maintain capital discipline despite relatively high oil prices.
OPEC also revised downward its estimate for crude demand from countries participating in the Declaration of Cooperation to 42.7 million barrels per day in 2026, although this would still represent an increase of about 400,000 barrels per day compared to 2025 levels.
