Morgan Stanley
The bank cited slower economic growth in China, increased electric vehicle adoption, and a rise in LNG-powered trucks in the country, reported Reuters.
In particular, the bank reduced its 2024 global oil demand growth forecast to 1.1 million barrels per day (mbpd) from 1.2 mbpd.
Morgan Stanley also lowered its Brent price forecast, expecting prices to average $80 per barrel in the fourth quarter, down from the previous estimate of $85 per barrel.
As per the report, Brent crude traded around $78 per barrel on Friday, while U.S. West Texas Intermediate crude futures were at $74.52.
Analysts noted that China's shift to LNG trucks has reduced oil demand growth by 100-150 kbd, and EV adoption has displaced about 100 kbd of gasoline demand.
The oil market is tight, with inventories down by 1.2 million barrels per day over the past four weeks. Morgan Stanley analysts expect this trend to continue through the third quarter.
Recently, the Organization of the Petroleum Exporting Countries (OPEC) revised its global oil demand growth estimate for 2024 to 1.78 million barrels per day (mb/d), which is down from the previous projection of 1.85 mb/d.
For 2025, OPEC lowered oil demand growth globally to 2.11 mb/d vs. the prior estimate of 2.25 mb/d.
OPEC stated, "This slight revision reflects actual data received for the first quarter of 2024 and, in some cases, the second quarter, as well as reduced expectations for China's oil demand growth in 2024."
