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OPEC Forecasts 23% Surge in Energy Demand by 2045

Snapshot from the G20 energy ministers meeting in India (G20's Twitter page)
Snapshot from the G20 energy ministers meeting in India (G20's Twitter page)
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OPEC Forecasts 23% Surge in Energy Demand by 2045

Snapshot from the G20 energy ministers meeting in India (G20's Twitter page)
Snapshot from the G20 energy ministers meeting in India (G20's Twitter page)

Secretary-General of the Organization of the Petroleum Exporting Countries (OPEC) Haitham Al Ghais predicted a 23% surge in energy demand by the year 2045. This projection considers the anticipated growth in the global economy, as well as the expected population increase.

During a meeting of G20 energy ministers in India, Al Ghais emphasized the necessity of investing in energy transitions with a comprehensive approach that benefits all people, all types of fuels, and all technologies.

He further stated that OPEC is eager to closely collaborate with the G20 to enhance a sustainable energy future for the world.

In response to the global economic uncertainty and the slowdown in China’s economy, which is the world’s largest oil importer and the second-largest economy, the OPEC+ alliance has decided to reduce its oil production.

UAE Energy Minister Suhail Al Mazroui expressed that OPEC+ is taking adequate measures to stabilize the oil market.

“We believe that what we are doing in OPEC+ is sufficient to address the issue of supply and demand,” said Al Mazroui.

“We are acting on behalf of all producers worldwide and in the interest of achieving a balance between supply and demand for all consumers as well,” he added.

Al Mazroui also emphasized the pivotal role of OPEC+, responsible for nearly 40% of global crude oil production, in managing the energy market for the benefit of both producers and consumers.

The OPEC+ alliance includes the Organization of the Petroleum Exporting Countries (OPEC) and allies such as Russia.

On his part, the Executive Director of the International Energy Agency, Fatih Birol, affirmed that the agency will revise its projections for global oil demand growth based on economic growth expectations in China and some other countries.

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UK Inflation Jumps to 2.3%

FILE PHOTO: A view of HSBC building in Canary Wharf financial district in London, Britain, August 1, 2023. REUTERS/Susannah Ireland/File Photo
FILE PHOTO: A view of HSBC building in Canary Wharf financial district in London, Britain, August 1, 2023. REUTERS/Susannah Ireland/File Photo
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UK Inflation Jumps to 2.3%

FILE PHOTO: A view of HSBC building in Canary Wharf financial district in London, Britain, August 1, 2023. REUTERS/Susannah Ireland/File Photo
FILE PHOTO: A view of HSBC building in Canary Wharf financial district in London, Britain, August 1, 2023. REUTERS/Susannah Ireland/File Photo

British inflation jumped by more than expected last month to rise back above the Bank of England's 2% target and underlying price growth gathered speed too, showing why the BoE is moving cautiously on interest rate cuts.

Consumer prices rose by an annual 2.3% in October, pushed up almost entirely by an increase in regulated domestic energy tariffs, after a 1.7% rise in September which was the first time the inflation rate had fallen below the BoE's target since 2021, Reuters reported.

Sterling strengthened by almost a third of a cent against the US dollar after the data was published before giving back most of that rise. Interest rate futures priced in a slightly slower pace of rate cuts and bond prices fell.
The BoE's most recent forecast and a Reuters poll of economists had both pointed to a weaker CPI reading of 2.2%.

James Smith, research director at the Resolution Foundation think tank, said a rise had been expected as last year's energy price falls dropped out of the annual calculation and the price cap increased in October.
"But the clean sweep of higher headline, core and services inflation has delivered a triple dose of bad news for families and policymakers alike," he said.
The increase took inflation to a six-month high and represented the biggest month-to-month rise in the annual CPI rate since inflation peaked in October 2022.
Services inflation - which the BoE views as a key measure of domestically generated price pressure - rose to 5.0% in October from 4.9% in September, the Office for National Statistics said, in line with BoE and market expectations.
But core inflation, which excludes energy, food, alcohol and tobacco prices, picked up to 3.3% from September's 3.2%, bucking market expectations for a fall.
The BoE said this month it expected headline inflation to tick up to 2.4% and 2.5% in November and December. Price growth is likely to approach 3% in the second half of next year, it says. Some private-sector economists think inflation will rise close to 3% in early 2025.
GLOBAL UNCERTAINTY
The BoE has said the first budget of Britain's new government will probably add to inflation next year and US President-elect Donald Trump's threat to impose sweeping import tariffs adds to uncertainty about the outlook.
Monica George Michail, an associate economist at Britain's National Institute of Economic and Social Research think tank, said interest rates might stay elevated for longer.
"This outlook reflects forecasted inflationary pressures stemming from the recently announced budget, in addition to heightened global uncertainty, particularly surrounding the Trump presidency," she said.
The new government of Prime Minister Keir Starmer has promised to speed up Britain's economic growth but has come under fire from employers for the higher employment taxes that they will have to pay from April next year.
The BoE has said that could lead to higher prices as well as job losses.
Chief Secretary to the Treasury Darren Jones said the government was trying to reduce the impact of the higher cost of living, including with a latest increase in the minimum wage, "but we know there is more to do."
Mel Stride, the Conservative opposition's would-be finance minister, said the government's fiscal watchdog had already been predicting higher inflation as a result of the budget.
"What is worrying about today's announcement is that inflation is running ahead of expectations and official forecasts state these figures are not expected to improve," he said.
There is also upward pressure on prices from the jobs market where many employers face a shortage of candidates.
Data last week showed British pay grew at its slowest pace in more than two years in the three months to the end of September. But BoE Chief Economist Huw Pill said wage growth was stuck at levels that were too high for the central bank.
Investors on Wednesday were pricing around 60 basis points of BoE rate reductions by the end of 2025, equivalent to between two and three cuts, down from about 65 basis points of cuts expected by investors before the inflation data.
Two-year British government bond yields, which are sensitive to interest rate speculation, rose by around 4 basis points.
Governor Andrew Bailey on Tuesday stressed the BoE's message that borrowing costs are likely to come down only gradually.
There were signs of some weaker inflation pressures in the pipeline. Prices charged by factories for their goods fell by 0.8% in the 12 months to October, the biggest drop since October 2020 during the COVID pandemic.