OPEC said on Tuesday Chinese oil demand would rebound this year due to relaxation of the country’s COVID-19 curbs and drive global growth, and sounded an optimistic note on the prospects for the world economy in 2023.
World demand in 2023 will rise by 2.22 million barrels per day (bpd), or 2.2%, the Organization of the Petroleum Exporting Countries (OPEC) said in a monthly report, unchanged from last month’s forecast, which had ended a series of downgrades.
OPEC sounded upbeat on the world economy’s prospects this year, even though it still expects a relative slowdown, saying growth last year in the United States and the euro zone had surpassed previous forecasts.
“The global momentum in the fourth quarter of 2022 appears stronger than previously expected, potentially providing a sound base for the year 2023,” OPEC said in the report.
“Chinese oil demand is on course to rebound due to the recent relaxation of the country’s zero-COVID-19 measures,” it said in a separate section, adding that plans to expand fiscal spending were also likely to support demand.
OPEC expects Chinese demand to grow by 510,000 bpd in 2023. Last year, the country’s oil use posted its first contraction for years due to the COVID containment measures.
The report also showed that OPEC’s production rose in December, even after the wider OPEC+ alliance pledged steep output cuts to support the market, led by a rebound in Nigeria which is exempt from voluntary supply cuts.
OPEC said its crude oil output in December rose by 91,000 bpd to 28.97 million bpd.