Oil may not escape a recession

Those who believe a global recession has been avoided may be mistaken, with huge ramifications for the oil market in 2024

The theme for oil demand expectations at the beginning of 2024 is that the US and Chinese economies will prove their resilience and global crude consumption patterns will hit new records. It is a fragile and, arguably, misplaced assumption that could see oil prices slump and OPEC’s market management tested to its limits as supply tries not to overwhelm demand. Oil demand will increase by 1.1m b/d in 2024, according to the IEA. This is 130,000b/d above the agency’s previous estimate as it now assumes a better economic outlook for the US and a soft landing. OPEC echoes this bullishness, with its December oil market report highlighting an increase of 2.2m b/d, which is the same as its November