IEA sees 2025 oil demand up 740,000 b/d led by early OECD strength, flat outlook ahead

[Global Oil Market and Financial Trading]

World oil demand is forecast to increase by 740 kb/d y-o-y in 2025, up marginally from last month's report, with resilient deliveries in advanced economies contrasting with relatively muted consumption in emerging economies, the International Energy Agency said on Thursday.

Brent crude (CO1:COM [https://seekingalpha.com/symbol/CO1:COM]) eased 0.6% to $67.07, while U.S. West Texas Intermediate (CL1:COM [https://seekingalpha.com/symbol/CL1:COM]) fell 0.8% to $63.19.

OECD demand growth of 80 kb/d y-o-y in 1H25 has exceeded expectations, supported by lower oil prices, but is forecast to move into contraction in the remainder of the year, leaving 2025 annual oil use broadly flat.

World oil production is now projected to rise by 2.7 mb/d to 105.8 mb/d this year and 2.1 mb/d to 107.9 mb/d next year, of which non-OPEC+ countries account for 1.4 mb/d and just over 1 mb/d, respectively.

Oil markets are being pulled in different directions by a range of forces, with the potential for supply losses stemming from new sanctions on Russia and Iran coming against a backdrop of higher OPEC+ supply and the prospect of increasingly bloated oil balances, the IEA said.

Benchmark crude oil prices drifted lower in August, with ICE Brent futures falling by about $2/bbl m-o-m to $67/bbl.

"Geopolitical concerns intensified amid dwindling hopes for a near-term peace deal between Russia and Ukraine. However, the prospect of looming oversupply dampened any positive price impetus, as investor sentiment towards oil remained strongly bearish."

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