OPEC is keeping its 2025 prediction for global oil demand growth steady at 1.29 million barrels per day (bpd), while raising its 2026 forecast to 1.38 million bpd.

OPEC Report Insights

The latest report has lowered the 2026 forecast for non-OPEC+ supply growth to 630,000 bpd, down from 730,000 bpd. It also predicts a decline of 100,000 bpd in U.S. tight oil production next year. In July, crude oil output averaged 41.94 million bpd, showing an increase of 335,000 bpd from June, thanks to higher OPEC+ production. These forecasts typically don’t impact the market directly, as actual pricing is often affected by market conditions that arise before changes materialize. External factors like U.S. economic reports and Federal Reserve decisions can influence expected demand growth and adjustments in oil prices. We believe OPEC’s forecasts support a positive view for oil prices as we approach 2026. A combination of steady demand growth this year and a forecasted drop in non-OPEC supply next year suggests a tighter market. Therefore, if prices dip in the coming weeks, they might present good buying opportunities. This perspective is bolstered by recent economic data from earlier this month. The U.S. July 2025 inflation report showed core CPI easing to 2.8%, raising expectations that the Federal Reserve might cut interest rates by year-end. As experienced during the low-rate period of the late 2010s, relaxed monetary policy generally boosts economic activity and oil demand.

Traders Strategic Considerations

On the demand side, recent data shows China’s crude imports in July 2025 reached their highest level in over a year. This suggests that their economic stimulus measures are working and supporting global demand. Strong demand from China offers a solid price foundation, supporting OPEC’s growth forecasts. The supply forecast also seems reliable when we look at U.S. production trends. The Baker Hughes rig count has been slowly declining throughout the first half of 2025, continuing the trend witnessed in 2024. This aligns with OPEC’s prediction of falling U.S. tight oil production next year, reducing a significant source of supply growth. Given this situation, traders might want to prepare for higher prices down the line. Buying long-term call options, such as those for March 2026, could be a smart move to take advantage of the expected tightening market. This strategy allows for potential gains while managing risk. In the short term, the recent increase in OPEC+ output for July may lead to some price stability or slight weakness. We should expect potential volatility ahead of major economic data releases. Traders could consider options strategies like straddles to capitalize on price movements in either direction over the next few weeks. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now