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BofA reports rising non-OPEC+ output and slowing demand growth; forecasts Brent crude at $86 in 2024 and $80 in 2025.
In a research released to Rigzone on August 20, Bank of America (BofA) Global Research warned of a "soft" fundamental supply-demand backdrop for oil. According to the analysis, there will be a notable surge in non-OPEC+ oil output, with an approximate daily increase of one million barrels in 2024 and 1.6 million barrels in 2025. The main contributors to this growth are Brazil, Guyana, Canada, and the United States.
Meanwhile, OPEC+ is preparing to potentially reintroduce some oil volumes in the fourth quarter of 2024. Despite this, global oil demand growth is projected to slow substantially due to increased electric vehicle penetration in China and other regions. BofA anticipates global oil demand growth to average one million barrels per day in 2024 and 1.1 million barrels per day in 2025. This could lead to a 700,000-barrel per day surplus by 2025, with potential significant builds in both commercial and strategic oil inventories.
According to BofA, the average price of a barrel of Brent crude oil will be $86 in 2024 and drop to $80 in 2025. The research also highlights divergent estimates of the growth of the world's oil demand for 2024 from different agencies, with estimates ranging from 970,000 to 2.112 million barrels per day.
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