Markets.com Logo
euEnglish
LoginSign Up

IEA predicts a significant surplus in oil production capacity by 2030

Sep 29, 2024
4 min read
Table of Contents
  • 1. Forecasts of the global oil demand
  • 2. Supply Surplus
  • 3. Western sanctions and OPEC+ cuts

decreasing-graph-against-background-barrels-oil-width-1200-format-jpeg.jpg

 

Global oil demand, including biofuels, will likely level off near 106 million b/d toward the end of this decade, up from just over 102 million b/d in 2023, due to the boom in electric vehicles, renewable energy and fuel efficiencies, the IEA said in its latest annual mid-term outlook, "Oil 2024."

Total global oil demand is projected to increase by 3.2 million barrels per day (b/d) between 2023 and 2030, primarily driven by higher consumption of jet fuel and petrochemical feedstocks. According to the IEA, demand growth will continue to be fueled by Asia's largest economies, with China seeing significant increases in the petrochemical sector, while India will experience notable growth in transport fuel demand. In contrast, oil demand in developed economies is expected to maintain a structural decline, dropping from approximately 46 million b/d in 2023 to under 43 million b/d by 2030, marking the lowest level since 1991.
 


Forecasts of the global oil demand


A year ago, the IEA forecasted that global oil demand would peak by the end of the decade, with a 6% increase to 105.7 million barrels per day (b/d) from 2022 to 2028.

In contrast, S&P Global Commodity Insights projects global oil demand, including biofuels, will reach a peak of around 109 million b/d in 2034, followed by a gradual decline, not falling below 100 million b/d until 2050. For 2024, Commodity Insights anticipates an average demand of 104.8 million b/d.

Separately, the IEA cut its 2024 global oil demand growth forecast for a third consecutive month, trimming 100,000 b/d from the estimate, citing contracting demand in OECD countries and signs that Chinese demand growth slumped to just 95,000 b/d in April. Helped by an upward revision to its 2023 demand estimates, the IEA now sees world oil demand growing by just 960,000 b/d this year to average 103.2 million b/d.
 


"Oil's subdued outlook is expected to carry forward into 2025, with a modest increase of 1 million b/d reflecting lackluster economic growth, an expanding EV fleet and vehicle efficiency gains," the IEA said in its latest monthly oil market report.

oil-field-site-evening-pumps-running-width-1200-format-jpeg.jpg

 

Supply Surplus


With oil demand expected to peak in the coming years, the IEA projects that global surplus production capacity could reach "unprecedented levels" by 2030, potentially challenging OPEC+'s current strategy of price stabilization.

The IEA forecasts total oil supply capacity to increase by 6 million barrels per day (b/d) to 113.8 million b/d by 2030—an excess of 8 million b/d over the projected demand of 105.4 million b/d. This would represent the largest supply surplus since the demand collapse during the 2020 coronavirus pandemic, potentially disrupting OPEC+'s market management efforts and impacting global crude markets.


"Such a massive oil production buffer could usher in a lower oil prices environment, posing tough challenges for producers in the US shale patch and the OPEC+ bloc. Given shale's short-cycle time frame and price reactivity, some output could be at risk ...moreover, reduced requirements for OPEC+ crude may put the alliance's market management to the test," the IEA said.



Western sanctions and OPEC+ cuts


The IEA noted that Saudi Arabia's recent decision to pause plans for increasing its crude output capacity by 1 million barrels per day (b/d) could lead other OPEC members to reconsider their own capacity expansion plans amid looming excess supply.

Outside of the OPEC+ group, capacity additions are expected to contribute 4.6 million b/d, or 76% of the total net increase by 2030, according to the IEA. Most of this growth will come from the Americas, with the U.S. alone accounting for 2.1 million b/d of non-OPEC+ gains, while Argentina, Brazil, Canada, and Guyana are forecast to add a combined 2.7 million b/d.
 


"The projections in this report, based on the latest data, suggest a significant supply surplus emerging this decade, signaling that oil companies should align their business strategies with the evolving market dynamics," said IEA Executive Director Fatih Birol.
 


Despite Western sanctions, Russia—OPEC+'s second-largest exporter—is expected to largely maintain its oil production through the rest of the decade, driven by the ramp-up of the Vostok project. Although Russian output is projected to fall by 260,000 b/d to 10.7 million b/d due to OPEC+ cuts, the IEA estimates that production could recover to an average of 10.83 million b/d by 2030.
 



When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss. 


Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.
 


Risk Warning and Disclaimer: This article represents only the author’s views and is for reference only. It does not constitute investment advice or financial guidance, nor does it represent the stance of the Markets.com platform. Trading Contracts for Difference (CFDs) involves high leverage and significant risks. Before making any trading decisions, we recommend consulting a professional financial advisor to assess your financial situation and risk tolerance. Any trading decisions based on this article are at your own risk.

Frances Wang
Written by
Frances Wang
SHARE

Markets

  • Palladium - Cash

    chartpng

    --

    0.08%
  • EUR/USD

    chartpng

    --

    0.07%
  • Cotton

    chartpng

    --

    0.48%
  • AUD/USD

    chartpng

    --

    0.01%
  • Santander

    chartpng

    --

    2.91%
  • Apple.svg

    Apple

    chartpng

    --

    -0.56%
  • easyJet

    chartpng

    --

    6.86%
  • VIXX

    chartpng

    --

    0.00%
  • Silver

    chartpng

    --

    -0.02%
Tags DirectoryView all
Table of Contents
  • 1. Forecasts of the global oil demand
  • 2. Supply Surplus
  • 3. Western sanctions and OPEC+ cuts

Related Articles

IBO stock up 200% today: what’s going on with Impact Biomedical

IBO stock up 200% today: the recent surge in Impact Biomedical’s stock price has caught the attention of the investment community.

Ghko B|1 day ago

Morning Note: Mideast Tensions Drive Oil & Gold Volatility; Tesla Rolls Out Robotaxi

Oil prices briefly surged to five-month highs as investors anxiously awaited a potential Iranian response to U.S. strikes on its nuclear facilities.

Tommy Yap|1 day ago

Global tensions impacted crypto market: BTC over $100K, Cardano around $0.54

Global tensions impacted crypto market: the cryptocurrency market is often influenced by a myriad of factors, and recent global tensions have made a significant impact.

Ghko B|2 days ago
Markets.com Logo
google playapp storeweb tradertradingView

Contact Us

support@markets.com+12845680155

Markets

  • Forex
  • Shares
  • Commodities
  • Indices
  • Crypto
  • ETFs
  • Bonds

Trading

  • Trading Tools
  • Platform
  • Web Platform
  • App
  • TradingView
  • MT4
  • MT5
  • CFD Trading
  • CFD Asset List
  • Trading Info
  • Trading Conditions
  • Trading Hours
  • Trading Calculators
  • Economic Calendar

Learn

  • News
  • Trading Basics
  • Glossary
  • Webinars
  • Traders' Clinic
  • Education Centre

About

  • Why markets.com
  • Global Offering
  • Our Group
  • Careers
  • FAQs
  • Legal Pack
  • Safety Online
  • Complaints
  • Contact Support
  • Help Centre
  • Sitemap
  • Cookie Disclosure
  • Regulation
  • Awards and Media

Promo

  • Gold Festival
  • Crypto Weekend Trading
  • marketsClub
  • Welcome Bonus
  • Loyal Bonus
  • Referral Bonus

Partnership

  • Affiliation
  • IB

Follow us on

  • Facebook
  • Instagram
  • Twitter
  • Youtube
  • Linkedin
  • Threads
  • Tiktok

Listed on

  • 2023 Best Trading Platform Middle East - International Business Magazine
  • 2023 Best Trading Conditions Broker - Forexing.com
  • 2023 Most Trusted Forex Broker - Forexing.com
  • 2023 Most Transparent Broker - AllForexBonus.com
  • 2024 Best Broker for Beginners, United Kingdom - Global Brands Magazine
  • 2024 Best MT4 & MT5 Trading Platform Europe - Brands Review Magazine
  • 2024 Top Research and Education Resources Asia - Global Business and Finance Magazine
  • 2024 Leading CFD Broker Africa - Brands Review Magazine
  • 2024 Best Broker For Beginners LATAM - Global Business and Finance Magazine
  • 2024 Best Mobile Trading App MENA - Brands Review Magazine
  • 2024 Best Outstanding Value Brokerage MENA - Global Business and Finance Magazine
  • 2024 Best Broker for Customer Service MENA - Global Business and Finance Magazine
LegalLegal PackCookie DisclosureSafety Online

Payment
Methods

mastercardvisanetellerskrillwire transferzotapay
The markets.com/za/ site is operated by Markets South Africa (Pty) Ltd which is a regulated by the FSCA under license no. 46860 and licensed to operate as an Over The Counter Derivatives Provider (ODP) in terms of the Financial Markets Act no.19 of 2012. Markets South Africa (Pty) Ltd is located at BOUNDARY PLACE 18 RIVONIA ROAD, ILLOVO SANDTON, JOHANNESBURG, GAUTENG, 2196, South Africa. 

High Risk Investment Warning: Trading Foreign Exchange (Forex) and Contracts For Difference (CFDs) is highly speculative, carries a high level of risk and is not appropriate for every investor. You may sustain a loss of some or all of your invested capital, therefore, you should not speculate with capital that you cannot afford to lose. You should be aware of all the risks associated with trading on margin. Please read the full  Risk Disclosure Statement which gives you a more detailed explanation of the risks involved.

For privacy and data protection related complaints please contact us at privacy@markets.com. Please read our PRIVACY POLICY STATEMENT for more information on handling of personal data.

Markets.com operates through the following subsidiaries:

Safecap Investments Limited, which is regulated by the Cyprus Securities and Exchange Commission (“CySEC”) under license no. 092/08. Safecap is incorporated in the Republic of Cyprus under company number ΗΕ186196.

Finalto International Limited is registered  in the Saint Vincent and The Grenadines (“SVG”) under the revised Laws of Saint Vincent and The Grenadines 2009, with registration number  27030 BC 2023.

set cookie

set cookie

We use cookies to do things like offer live chat support and show you content we think you’ll be interested in. If you’re happy with the use of cookies by markets.com, click accept.