Poten’s Weekly Opinion – IEA warns oil demand will peak this decade

Jun 14 2024

Is oil running out of gas?

So far this year, we have seen new oil discoveries and developments in Guyana, Suriname, Senegal as well as the startup of exports from the Trans Mountain Expansion in Vancouver and oil flowing from Niger via a pipeline through Benin. While not as fast as in recent years, shale oil production is still growing in the U.S. In theory, rapid production and export growth from these countries should be a boon for the tanker market. None of them are OPEC+ members and therefore not subject to production and/or export quota.
Furthermore, most of these producers are located in the Atlantic Basin, while demand growth continues to be concentrated in the Pacific, boosting long-haul tanker demand. However, there is a possible fly in the ointment. According to the latest IEA report, called “Oil 2024”, global demand for oil will peak in 2029 and start its decline thereafter. This forecast spells trouble for the OPEC cartel and possibly for the tanker market. Let’s take a closer look at the IEA’s projections, OPEC’s counterarguments and what this could mean for the tanker market.

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