Opec lowers global economic, oil demand forecasts

Vienna: The Organisation of the Petroleum Exporting Countries (Opec) on Thursday revised its forecasts for this year's global economic growth and oil demand, citing COVID-19-induced restrictions and geopolitical tensions.

The oil alliance said in its monthly oil market report that the world economy is expected to grow by 3.5 per cent in 2022, compared to its forecast of 3.9 per cent a month ago.

Opec said notable challenges facing the global economy include "geopolitical tensions, the continued pandemic, rising inflation, aggravated supply chain issues, high sovereign debt levels in many regions and expected monetary tightening by central banks in the United States, the United Kingdom, Japan and the euro area."

The oil-producer group also forecasts the global oil demand this year to increase by 3.4 million barrels per day year on year, down 300,000 barrels per day from last month's assessment.

Oil demand in 2022 is expected to be "impacted by ongoing geopolitical developments in Eastern Europe, as well as COVID-19 pandemic restrictions," Opec said in its report.