OPEC expressed confidence in continued global economic resilience through the second half of 2025 while simultaneously reducing its forecast for oil supply growth from producers outside the expanded OPEC+ alliance in 2026, according to its monthly report released Monday.
The Organization of the Petroleum Exporting Countries maintained its projections for global oil demand growth in both 2025 and 2026, unchanged from April’s revisions. Despite acknowledging trade concerns, OPEC described the overall economic outlook as “robust.”
“The global economy has outperformed expectations so far in the first half of 2025,” OPEC stated. “This strong base… is anticipated to provide support and sufficient momentum into a sound second half of 2025. However, the growth trend is expected to moderate slightly on a quarterly basis.”
Key Supply Forecast Revisions:
- Non-OPEC+ Supply (2026): OPEC now expects supply growth from producers outside the “Declaration of Cooperation” (OPEC+) to reach approximately 730,000 barrels per day (bpd) in 2026. This represents a downward revision of 70,000 bpd from last month’s forecast.
- US Shale Oil (2026): OPEC significantly adjusted its outlook for US tight oil (shale) production. It now forecasts output will hold steady in 2026 at 9.05 million bpd, abandoning previous expectations of growth. This contrasts sharply with a January 2026 forecast of 9.28 million bpd. OPEC cited factors like sustained capital discipline by producers, efficiency gains, weaker drilling momentum, and increased associated gas production.
Market Context:
This combination of solid economic fundamentals and constrained growth from rival producers (like US shale) would ease OPEC+’s task of balancing the oil market. Rapid non-OPEC+ supply growth, particularly from the US, has previously pressured prices. Recent oil price volatility saw Brent crude ($LCOc1) jump near $80/barrel on Friday due to Israel-Iran tensions, countering earlier pressure from OPEC+ output increases and US tariffs.
OPEC+ Output & Compliance:
- The report showed OPEC+ production rose by 180,000 bpd in May to 41.23 million bpd. This increase was significantly less than the 411,000 bpd hike implied by the group’s higher May quotas.
- The shortfall stemmed partly from countries like Iraq implementing cuts to compensate for prior overproduction.
- Kazakhstan’s Output: Highlighting ongoing compliance challenges, Kazakhstan’s production fell by 21,000 bpd in May to 1.803 million bpd. Despite this reduction, its output remained above its assigned OPEC+ quota.