Oil prices drop to lowest level since 2021
Oil prices have dropped to their lowest level since 2021, influenced by OPEC's expectations of dwindling demand, which have impacted the global crude market. Read Full Article at RT.com
TroibNews 
Crude prices dropped sharply on Tuesday following OPEC’s revision of its demand growth forecast downward for this and next year, marking its second consecutive reduction.
The international benchmark, Brent crude, declined by 3.7%, reaching $69.08 a barrel as of 18:30 GMT, dipping below $70 for the first time since December 2021. Similarly, the American benchmark, West Texas Intermediate (WTI), fell by over 4% to $65.72 per barrel, reaching its lowest point since May 2023.
In its monthly report released on Tuesday, OPEC adjusted its forecast for global oil demand growth in 2024 to an increase of approximately two million barrels per day, which is about 80,000 bpd slower than its previous prediction. The forecast had remained stable since its initial projection in July 2023.
China, the world's top crude importer, was mainly responsible for the recent reductions, with OPEC reducing its expectation for China’s demand growth in 2024 to 650,000 bpd.
“Looking ahead, China’s economic growth is expected to remain well supported,” stated OPEC. The report also noted, “However, headwinds in the real estate sector and the increasing penetration of LNG trucks and electric vehicles are likely to weigh on diesel and gasoline demand going forward.”
Additionally, the forecast for global demand growth in 2025 was also lowered by OPEC, now expected at 1.74 million bpd compared to the earlier estimate of 1.78 million bpd.
The report indicates that crude demand for OPEC and its allies, collectively known as OPEC+, is anticipated to be around 43.8 million bpd in the fourth quarter of the year.
Amid sluggish growth in oil demand and global geopolitical tensions, OPEC+ has implemented significant production reductions since late 2022. In June, the output was adjusted down by 130,000 bpd to 40.87 million bpd. Moreover, last month, the group resolved to prolong most existing cuts well into 2025, with an added voluntary reduction of 2.2 million bpd extended until September of this year.
Despite initially planning to commence rolling back these recent cuts in October, the group recently opted to postpone this move for an additional two months due to the ongoing slump in oil prices.
Debra A Smith for TROIB News
The international benchmark, Brent crude, declined by 3.7%, reaching $69.08 a barrel as of 18:30 GMT, dipping below $70 for the first time since December 2021. Similarly, the American benchmark, West Texas Intermediate (WTI), fell by over 4% to $65.72 per barrel, reaching its lowest point since May 2023.
In its monthly report released on Tuesday, OPEC adjusted its forecast for global oil demand growth in 2024 to an increase of approximately two million barrels per day, which is about 80,000 bpd slower than its previous prediction. The forecast had remained stable since its initial projection in July 2023.
China, the world's top crude importer, was mainly responsible for the recent reductions, with OPEC reducing its expectation for China’s demand growth in 2024 to 650,000 bpd.
“Looking ahead, China’s economic growth is expected to remain well supported,” stated OPEC. The report also noted, “However, headwinds in the real estate sector and the increasing penetration of LNG trucks and electric vehicles are likely to weigh on diesel and gasoline demand going forward.”
Additionally, the forecast for global demand growth in 2025 was also lowered by OPEC, now expected at 1.74 million bpd compared to the earlier estimate of 1.78 million bpd.
The report indicates that crude demand for OPEC and its allies, collectively known as OPEC+, is anticipated to be around 43.8 million bpd in the fourth quarter of the year.
Amid sluggish growth in oil demand and global geopolitical tensions, OPEC+ has implemented significant production reductions since late 2022. In June, the output was adjusted down by 130,000 bpd to 40.87 million bpd. Moreover, last month, the group resolved to prolong most existing cuts well into 2025, with an added voluntary reduction of 2.2 million bpd extended until September of this year.
Despite initially planning to commence rolling back these recent cuts in October, the group recently opted to postpone this move for an additional two months due to the ongoing slump in oil prices.
Debra A Smith for TROIB News
