In its September report on the oil markets, OPEC has again revised down its forecasts for oil demand this year. It now believes the world will consume 90.2 million barrels per day (bpd) on average this year – about 10% less than last year.

The report points to the sluggish recovery of the demand for transportation fuel in OECD countries, which in turn affects the need for oil. It continues:

“Additionally, risks remain elevated and skewed to the downside, particularly in relation to the development of COVID-19 infection cases and potential vaccines. Furthermore, the speed of recovery in economic activities and oil demand growth potential in Other Asian countries, including India, remain uncertain.”

Despite the drastic drop in demand resulting from the ongoing pandemic, OPEC and its partners have succeeded in bringing stability to oil markets, with oil barrel prices having remained around the $40 mark in recent months.

OPEC predicts a 6.6 million bpd rise in demand next year, which means that it does not expect demand to return to pre-pandemic levels, at least not in 2021. While oil will continue to be needed for some time to come, such as for industrial lubricants like hydraulic oil, oil majors will likely transition into other forms of energy. For example, the owner of the Castrol brand, BP, recently signalled its intention to reduce oil production over the coming decade, and invest more in renewable energy projects.

OPEC also recently celebrated its 60th anniversary, and says it is ready to face the challenges in the coming 60 years.