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OPEC lowers its forecast for oil demand in 2022 due to the war in Ukraine

OPEC cut its forecast for global oil demand growth in 2022 on Tuesday, citing fallout from the Russian war in Ukraine, rising inflation with soaring crude oil prices and resurgence of the mutated coronavirus strain Omicron in China.

The Organization of Petroleum Exporting Countries (OPEC) said in a monthly report that global demand will increase by 3.67 million barrels per day in 2022, in drop of 480,000 barrels per day compared to the previous forecast.

The outbreak of war in Ukraine pushed oil prices above $ 139 a barrel in February, the highest level since 2008, exacerbating inflationary pressures.

A number of countries have announced plans to leverage strategic oil reserves to increase supply, but oil prices are still above $ 100.

“The sharp rise in material prices prime, in combination with bottlenecks in course in the supply chain since the outbreak of the Corona epidemic, with the escalating closures in China and in other parts of the world, all of this exacerbates inflation, “the report said.

However, global oil consumption is still expected to exceed 100 million barrels per day in the third quarter, as previously predicted by OPEC.

OPEC revised its forecast for Russian oil supplies, in a decline of 530,000 barrels per day, to 11.23 million barrels.

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