The Organization of the Petroleum Exporting Countries (OPEC) has slightly revised its oil demand forecast downward for 2025, citing rising global economic uncertainties driven by recent U.S. tariffs and ongoing market fluctuations.
In its April Monthly Oil Market Report, OPEC now projects global oil demand growth at 1.3 million barrels per day (bpd) in 2025—down from a previous estimate of 1.4 million bpd. This reflects a broader trend of weakening projections, as both the current and previous forecasts have been adjusted downward by 150,000 bpd compared to last month’s figures.
The revision comes amid a sharp decline in the price of OPEC’s basket of twelve crude blends, which dropped to $66.25 per barrel on Monday, down from $70.85 the previous Friday. The pressure on oil prices is largely attributed to renewed trade tensions and plans by the OPEC+ alliancewhich includes Russia and other non-OPEC partners to gradually increase production.
U.S. trade policies under President Donald Trump, particularly the newly imposed tariffs on exports from Nigeria and several other countries, have heightened concerns about a slowdown in global economic activity. Although the tariff regime has been temporarily suspended for 90 days, it has already triggered inflation in consumer prices, disrupted supply chains, slowed manufacturing, and stifled international trade.
Reflecting these broader challenges, OPEC has also lowered its global economic growth forecast for 2024 to 3.0 percent, down from an earlier estimate of 3.1 percent. The projection for 2025 has been revised to 3.1 percent from 3.2 percent. While OPEC previously expressed optimism that the global economy would adjust to trade frictions, the latest report acknowledges that “recent trade-related dynamics have introduced higher uncertainty to the short-term global economic growth outlook.”
Despite the revision, oil prices rebounded slightly after the report’s release, with Brent crude trading around $66 per barrel. However, prices remain over 10 percent lower than earlier this month, underscoring persistent market volatility.
While OPEC maintains one of the more optimistic outlooks in the industry, projecting continued growth in oil demand over the next several years, this contrasts with the International Energy Agency (IEA), which has suggested that global demand may peak before the end of this decade due to the accelerating shift toward cleaner energy alternatives. The IEA is expected to update its own forecasts soon.
On the supply side, OPEC+ reported a marginal decline in collective crude output in March, dropping by 37,000 bpd to 41.02 million bpd. This was largely driven by production cuts from Nigeria and Iraq. However, Kazakhstan once again breached its output quota, increasing its production to 1.852 million bpd in March—well above its agreed cap of 1.468 million bpd. The country’s energy ministry has pledged to meet its April quota and compensate for past overproduction.
In response to shifting market dynamics, eight key OPEC+ members, Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman held a virtual meeting on April 3, where they agreed to implement a production adjustment of 411,000 bpd in May 2025. This adjustment consolidates three months’ worth of planned output increases into a single increment. However, the alliance has left room to pause or reverse the increase should market conditions worsen.
The same group of countries is scheduled to reconvene on May 5 to reassess and determine production levels for June, signaling that OPEC+ remains cautious and flexible as global economic and energy trends continue to evolve.
