OPEC’s daily oil production is projected to dip below 27 million barrels per day (bpd) by 2024, according to industry analysts. Predictions suggest that international oil prices will likely remain close to $80 a barrel in 2024, influenced by anticipated weak global growth limiting demand and potential geopolitical tensions providing support,leadership report.
The last time OPEC experienced a market share drop to this level was during the peak of the COVID-19 pandemic when global oil demand plummeted by nearly 20 percent. The current gap is less than 27 percent of the total global supply of 102 million bpd, following Angola’s departure from the group in December.
Angola’s exit from OPEC was officially announced due to disagreements over oil production quotas. The country’s crude output decreased to 1.15 million barrels per day in November, a significant decline from 1.88 million barrels per day in 2017.
OPEC has historically maintained a market share in the 30-40 percent range, but increased shale production by the United States has impacted this share. U.S. oil output reached a record high of 13.1 million barrels per day this year.
While some analysts predict a slowdown in U.S. oil output increase in the coming year, others view estimates from the Energy Information Administration (EIA) as too conservative for 2024.
OPEC believes its market share loss may be temporary, forecasting a global market share of 40 percent in 2045, mainly due to a decline in non-OPEC output from the early 2030s. The organization anticipates global oil demand reaching 116 million bpd by 2045, driven by growth in India, China, Africa, and the Middle East.
However, doubts arise about OPEC+’s ability to sustain supply cuts to support the market. Geopolitical risks are expected to keep oil prices volatile in the coming months, with concerns about conflicts in the Middle East potentially affecting oil supply. The global benchmark Brent crude has averaged around $82.17 a barrel this year, facing a yearly decline, and analysts forecast Brent crude to average $82.56 in 2024. Geopolitical tensions are expected to contribute to oil price volatility in the future.