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News > Austria

World Oil Consumption To Rise Despite Omicron: OPEC

  • An oil production plant, Nigeria.

    An oil production plant, Nigeria. | Photo: Twitter/ @FreedomOnlineng

Published 18 January 2022
Opinion

Consumption growth will be particularly strong in India, China, and the United States due to the strengthening of the petrochemical and transport sectors.

In a monthly market analysis, the Organization of the Petroleum Exporting Countries (OPEC) assured that the Omicron strain expansion will not alter its forecast of a 4.3 percent increase in world crude oil consumption by 2022.

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"Although the omicron variant may have an impact in the first half of 2022 due to containment measures and rising levels of hospitalization that affect the workforce, the world economy will remain above pre-2021 average growth levels thanks to unprecedented fiscal and monetary stimuli,” the OPEC report highlighted. 

Consumption growth will be particularly strong in India, China, and the United States due to the strengthening of the petrochemical and transport sectors. Given these projections, OPEC decided to maintain its plan to increase oil pumping and sell 400,000 more barrels every day from February.

The Vienna-based group also referred to the more inefficient production processes of global supply networks and the rise in inflation as factors to be monitored concerning the crude oil consumption evolution.

Its report analyses the impact of the progressive withdrawal of the economic stimuli applied by several central banks, a policy that has led to an increase in inflation.

The experts recalled that the United States, European countries, the United Kingdom, and Japan —the largest oil consumers— plan to reduce these stimuli at different rates and timeframes to raise interest rates.

OPEC does not expect such measures to hamper the current economic growth but to serve to "recalibrate economies that would be overheated otherwise".

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