With global economic growth expected to remain at 3.2 per cent in 2020, world oil demand in 2020 is forecast to grow by 1.14 million barrels per day (mb/d) y-o-y, a media report said, citing the Opec Monthly Oil Market Report (MOMR).

Demand for Opec crude for 2019 was revised up by 0.1 mb/d from the previous report to stand at 30.6 mb/d, 1.0 mb/d lower than the 2018 level, reported Emirates news agency Wam.

Based on the first forecasts for world oil demand and non-Opec supply for 2020, demand for Opec crude for 2020 is projected at 29.3 mb/d, 1.3 mb/d lower than the 2019 level, said the report for July.

In light of the uncertainties affecting the global oil market and in an effort to avoid a destabilising build-up in oil inventories, the report indicated that Opec and non-Opec countries participating in the Declaration of Cooperation agreed to extend voluntary production adjustments until 31 March 2020, reaffirming their continued commitment to promote and enhance oil market stability.

The OECD is forecast to grow by 0.09 mb/d next year, with only OECD Americas showing positive growth, while OECD Europe and Asia Pacific are anticipated to continue to decline. In the non-OECD, oil demand is expected to increase by around 1.05 mb/d.

Other Asia, it indicated, is projected to be the largest contributor to incremental oil demand in 2020, followed by China, which is forecast to be lower than in the current year.

Sector-wise, the report noted that the transportation sector is anticipated to lead growth on strong demand for motor and aviation fuels. Demand from the petrochemical sector will remain strong, although it will ease slightly in the US due to lower ethane cracking capacity additions.

''Factors that could influence the pace of oil demand growth in 2020 include macroeconomic developments in major consuming countries, the displacements of heavy distillates with natural gas and other fuels, subsidy programmes and plans for their removal, the effect of commissioning/delays/closures of mega projects in the downstream and fuel efficiency programmes, especially in the transportation sector,” the report said.

''Non-Opec oil supply is forecast to grow by 2.4 mb/d in 2020, higher than in the current year. This is mainly due to the debottlenecking of oil infrastructure in North America and new project ramp ups in Brazil, Norway and Australia.”

Investment by exploration and production (E&P) companies in the US is expected to reach around $180 billion next year, with the tight oil sector forecast to spend some $124 billion.