OPEC slashes oil demand growth forecast amid US-China trade war fallout

OPEC analysts have revised their global oil demand growth forecast, citing escalating trade tensions between the US and China as a key factor.

The organisation's updated outlook reflects concerns over the impact of rising US tariffs on Chinese imports, which have contributed to a slowdown in global economic activity, Caliber.Az reports per foreign media.

The trade conflict, largely triggered by US President Donald Trump’s decision to raise tariffs on Chinese goods by 145 per cent, has resulted in fears of weakened oil demand worldwide. As a consequence, OPEC has lowered its global demand growth projection for 2025 and 2026 by approximately 100,000 barrels per day, bringing the expected growth to 1.3 million barrels per day.

The organisation’s revised forecast comes at a time of heightened geopolitical and economic uncertainty, with analysts predicting that the ongoing trade war between the world's two largest economies could further dampen oil consumption. 

In a related development, OPEC has also reached an agreement with eight members of the OPEC+ alliance, including Russia, Saudi Arabia, Iraq, and Kazakhstan, to accelerate the gradual easing of current production restrictions. Starting in May, these countries will increase oil production by an additional 411,000 barrels per day compared to April levels. The decision is part of OPEC's efforts to stabilise global oil prices, which have been impacted by economic slowdowns and market volatility.

By Naila Huseynova