One of the most expected energy reports in the world is the OPEC (Organization of Petroleum Exporting Countries) World Oil Outlook. An annual publication, it offers a glimpse into the energy markets.
Since oil takes the largest share of the global energy mix, oil traders and alternative investment seekers put a great value on this report. The International Energy Agency (IEA) delivers a similar report, the World Energy Outlook – the competition for the World Oil Outlook from OPEC.
What’s New in 2020 OPEC WOO?
This report is full of trends for the years and even decades ahead. This year is particularly important because 2020 will remain in history for two things. One, the year the pandemic affected global economies. Two, the oil futures settled into negative territory for the first time in history.
One of the first things that the report states from the start is that oil will still have the largest share in the energy mix all the way until 2045. Also, despite the tremendous drop in demand seen in 2020, the primary energy market will continue to grow in twenty-five years too.
One interesting assumption is that the report builds consumption trends based on two pillars. One is global economic growth. OPEC sees the global economy to more than double by 2045. Another one is demographics – the world’s population is expected to come close to ten billion people by the same date.
As for oil consumption, road transportation remains the dominant consumption, challenged by the petrochemical industry. This is where OPEC sees the largest growth in the two-and-a-half decades ahead. Also, the penetration of electric and hydrogen vehicles will likely affect oil demand, especially in the second half of the forecasted period.
Asia-Pacific is the area where most oil imports will take place. In a way, it is normal, considering that most of the population growth in the decades ahead will come from the region. As such, distillation capacity is expected to increase in the region, as well as in the Middle East.
The report marks the challenges and opportunities in the oil market for the two decades ahead. This report also considers the impact COVID-19 had on the industry and the world’s economy in general.
As such, for anyone interested in how OPEC sees the oil market more than twenty years from now, including the pandemic effect, this is a must read report.