<article><p class="lead">Opec has revised lower its oil demand growth forecast for this year, partly because it assumes the pace of recovery has been hit by elevated prices.</p><p>In its latest <i>Monthly Oil Market Report</i> (MOMR), published today, Opec pegs this year's world oil demand at 96.44mn b/d, up by 5.65mn b/d on the year but down by 160,000 b/d from its previous projection. As well as the recent price rises, it said the reduction was because of slower-than-anticipated third-quarter consumption in major markets India and China.</p><p>Opec kept next year's assumption for demand growth unchanged at 4.15mn b/d, taking demand to 100.59mn b/d, but warned of mounting economic challenges in China and the Covid-19 pandemic, which it expects to remain "a dominating factor" during the northern-hemisphere winter. </p><p>At last week's Opec+ meeting, the alliance eschewed calls from some consuming countries for a faster increase in production and stayed steadfastly behind <a href="https://direct.argusmedia.com/newsandanalysis/article/2270610">its plan to raise collective output quotas</a> by 400,000 b/d next month.</p><p>Today's report kept its forecast for non-Opec liquids supply growth this year unchanged at around 700,000 b/d, for an average 63.64mn b/d, and still sees next year growing by 3mn b/d next year. It expects Russia and the US to be the main drivers of next year's growth, but said investment levels, particularly in the US shale sector, remain a concern.</p><p>Taking into account lower demand, Opec decreased its 2021 forecast call on its own members' crude by more than 100,000 b/d to 27.65mn b/d, and by a similar amount next year to 28.66mn b/d. The group's output was 27.5mn b/d last month, up by 217,000 b/d from July, according to an average of secondary sources including <i>Argus</i>.</p><p>Citing preliminary data, Opec said OECD commercial stocks fell by 18.5mn bl in September to 2.81bn bl, which is 374mn bl lower than a year earlier and 163mn bl below the 2015-19 average.</p><p>"With these market developments, the countries participating in the declaration of co-operation continue their course… to gradually return the adjusted production volumes by 400,0000 b/d on a monthly basis," the MOMR said. Opec+ will next meet on 2 December to discuss the production policy into the start of next year.</p><p class="bylines">By Rowena Edwards</p></article>
