8 October 2020 - 20:10
  • News Code: 308183
OPEC Launches 2020 Edition of World Oil Outlook

VIENNA (Shana) -- The 2020 OPEC World Oil Outlook (WOO) was launched today in Vienna, Austria, providing the OPEC Secretariat’s in-depth look at the unprecedented scale and impact of the COVID-19 pandemic on the global energy and oil markets, an assessment of the medium- and long-term prospects, as well as analysis of various alternative scenarios and sensitivities that have the potential to impact the petroleum industry in the years ahead.

The WOO for the first time extends its outlook to 2045, providing an additional fiveyear window to examine developments in energy and oil demand, oil supply and refining, the global economy, policy and technology developments, demographic trends, environmental issues and sustainable development.

In the foreword to the 14th edition, His Excellency Mohammad Sanusi Barkindo, OPEC Secretary General, highlighted that the publication was published at a defining moment in the history of OPEC, a year marked by the COVID-19 crisis and the Organization’s 60th anniversary.

“In a year without precedent, we are very proud to bring you this exceptional edition of the WOO with the hope that it enriches the global energy dialogue and inspires closer cooperation,” the Secretary General said. “As we turn an important page in our history, OPEC’s commitment to securing an efficient, economic and steady supply of oil to consuming countries, and providing essential support to the global economy, is as unshakable today as it was when the Organization was founded 60 years ago.”

The videoconference launch also featured remarks by Dr Rainer Seele, CEO of the Austrian oil and gas company OMV, and Dr Jonas Puck, Academic Director of the MBA in Energy Management programme at the Executive Academy of the Vienna University of Economics and Business.

This year’s edition of the WOO also examines the bold and decisive actions taken by 23 OPEC and non-OPEC oil-producing countries in the Declaration of Cooperation (DoC) in response to the unprecedented market challenges resulting from the pandemicrelated economic slump. The DoC committed to the largest and longest-ever oil production adjustments, which have helped to restore market stability since the second quarter of 2020 and provide a platform for recovery.

The WOO 2020 launch represents the culmination of months of planning, writing, review and production under unique circumstances. OPEC’s flagship annual publication was in large part carried out remotely, reflecting the global impact of COVID-19 on work environments and travel.

Like its predecessors, the WOO 2020 should be viewed as a helpful and insightful reference tool, one that underscores OPEC’s commitment to knowledge-sharing and data transparency. It also is intended to enrich the global energy dialogue and inspire closer cooperation – the hallmarks of OPEC’s 60-year record of success.

OPEC was founded by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela on 14 September 1960 during a ceremony at the Al-Shaab Hall in Baghdad, Iraq. The Organization today comprises 13 Member Countries and the OPEC Secretariat is located in Vienna, Austria.

Highlights from this year’s WOO include:

• The outbreak of the COVID-19 pandemic resulted in the sharpest downturn in energy and oil demand in living memory.

Despite the large drop in 2020, global primary energy demand is forecast to continue growing in the medium- and long-term, increasing by a significant 25% in the period to 2045.

• All forms of energy will be needed to support the post-pandemic recovery and to address future energy needs.

• Oil is expected to retain the largest share of the energy mix throughout the outlook period, accounting for a 27% share in 2045.

• Natural gas will be the fastest-growing fossil fuel between 2019 and 2045 and, after oil, will remain the second-largest contributor to the energy mix in 2045 at 25%.

• ‘Other renewables’  – combining mainly solar, wind and geothermal energy – will grow by 6.6% p.a. on average, significantly faster than any other source of energy.

• Assuming that the COVID-19 pandemic is largely contained by next year, oil demand is expected to partly recover in 2021 and healthy demand growth rates are foreseen over the medium-term horizon.

• Globally, oil demand is projected to increase from nearly 100 mb/d in 2019 to around 109 mb/d in 2045.

• In OECD countries, oil demand is expected to plateau at around 47 mb/d during the period 2022-2025 before starting a longer-term decline towards 35 mb/d by 2045.

• In contrast, demand in non-OECD countries is projected to rise by 22.5 mb/d over the forecast period, from nearly 52 mb/d in 2019 to 74 mb/d in 2045.

• India is expected to be the largest contributor to incremental demand, adding around 6.3 mb/d between 2019 and 2045. 

Oil demand in road transportation will continue to dominate the sectoral breakdown, but the largest growth will come from petrochemicals.

• Oil demand in the aviation sector was most affected by COVID-19 restrictions in relative terms, but is projected to partly recover in 2021 and will continue growing thereafter.

• US tight oil is expected to recover quickly as market conditions improve, but is not likely to reach heights projected in previous Outlooks.

• Looking further ahead, non-OPEC supply will decline again after US tight oil peaks around 2030 while OPEC liquids will fill the gap, rising by around 10 mb/d to 44 mb/d by 2045.

• The downstream has come under enormous pressure due to declining demand. This will likely force a wave of refinery closures, especially as new capacity comes online in the Asia-Pacific and Middle East & Africa regions.

• The global oil sector will need cumulative investment of $12.6 trillion in the upstream, midstream and downstream through to 2045.

• Traded volumes of oil are expected to grow only modestly in the long-term, in line with supply patterns. However, the Middle East’s share of global crude and condensate trade will rise robustly during the second part of the forecast period.

• Crude and condensate flows between the Middle East and Asia-Pacific remain the most important oil trade link, with volumes increasing from around 15 mb/d in 2019 to nearly 20 mb/d in 2045.

• The Asia-Pacific region is forecast to remain the most important crude oil importing region throughout the forecast period, with imports rising by more than 6 mb/d.

Technological advancements are set to shape the global energy landscape while public policies relating to energy demand and supply are expected to become more stringent over the forecast period. 

• Enhanced global collaboration is vital to address the challenge of climate change.

• International cooperation could allow a more coherent, balanced and integrated approach for realizing the Paris Agreement goals and interlinked sustainable development aspirations.

The WOO 2020 is available via two digital interfaces, the OPEC WOO App and a comprehensive interactive version, which can be accessed at woo.opec.org.

News Code 308183

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