BAKU, Azerbaijan, May 12. OECD Europe's oil demand is forecast to grow by 30,000 b/d year-on-year by 3Q2023 to reach 13.46 mb/d, Trend reports via monthly oil outlook from OPEC.
According to the OPEC data, oil demand in OECD Europe fell by 0.2 mb/d in February, compared to the same period last year. This is a similar decline, when the demand dropped by 0.2 mb/d in January, followed by a drop of 0.5 mb/d year-on-year in December 2022.
"This is projected to be mainly supported by jet fuel and gasoline requirements. The risks, however, are skewed to the downside, hinging on geopolitical developments and the possibility of an economic recession in the region," the report added.
"The region is still facing some macroeconomic headwinds, including high inflation and weak manufacturing activity. The consumer price inflation in the Euro-zone stood at 8.5 percent in February, marginally down from 8.6 percent a month earlier. The Euro-zone’s February PMI pointed to some improvement, particularly in the services sector, while manufacturing remained in contraction. The PMI for services was at 52.7 in February, up from 50.8 points in January and 49.8 points recorded in December. Meanwhile, however, the manufacturing PMI, contracted further to 48.5 points in February compared to 48.8 in January," the report said.
Meanwhile, OECD Europe's GDP in 2Q2023 is forecast to slow down from 1Q2023, but is expected to remain positive, OPEC noted.
"Oil demand growth in the quarter is anticipated to soften by 60,000 b/d compared to the same quarter a year earlier, albeit showing an improvement from the year-on-year decline seen in 1Q2023. Transportation fuels, most notably jet fuel, are expected to support oil demand improvements in the second quarter," the report added.