Insights 
VT 
OPEC has kept its forecast for global oil demand growth in 2025 unchanged at 1.29 million barrels per day (bpd). The organisation has increased its forecast for global oil demand growth in 2026 to 1.38 million bpd.
OPEC Report Insights
The report indicates a reduction in the 2026 forecast for non-OPEC+ supply growth, now at 630,000 bpd from the previous estimate of 730,000 bpd. It also anticipates a decrease of 100,000 bpd in US tight oil output for the next year.
July’s crude output averaged 41.94 million bpd, marking an increase of 335,000 bpd from June due to an OPEC+ output increase. These forecasts tend not to have a direct impact on the market, as market conditions often influence pricing before actual changes occur.
External factors, such as US economic data and Federal Reserve decisions, can affect expected demand growth and subsequent oil pricing adjustments.
We see these OPEC forecasts as reinforcing a bullish outlook for oil prices heading into 2026. The combination of steady demand growth this year and an expected cut to non-OPEC supply next year points to a tighter market. This outlook suggests that any price dips in the coming weeks should be viewed as buying opportunities.
This view is strengthened by recent economic data from earlier this month. The U.S. July 2025 inflation report showed core CPI cooling to 2.8%, increasing speculation that the Federal Reserve could begin cutting interest rates by year-end. As we saw during the low-rate environment of the late 2010s, looser monetary policy tends to stimulate economic activity and, consequently, oil demand.
Traders Strategic Considerations
On the demand side, recent figures show China’s crude imports for July 2025 hit their highest level in over a year. This indicates that their economic stimulus measures are taking hold and supporting global demand. This robust demand from China provides a solid floor for prices, validating OPEC’s growth forecasts.
The supply forecast also appears credible when looking at US production trends. The Baker Hughes rig count has been in a slow but steady decline through the first half of 2025, continuing the trend we saw in 2024. This supports OPEC’s projection of a decline in U.S. tight oil output next year, removing a key source of supply growth from the market.
Given this, traders should consider positioning for higher prices further out on the curve. Buying long-dated call options, such as those for the March 2026 contracts, could be a prudent strategy to capitalize on the expected market tightening. This allows for participation in the upside while defining risk.
In the immediate short term, the recent OPEC+ output hike for July might create some price stability or minor weakness. Therefore, we should anticipate a potential increase in volatility around the next major economic data releases. Traders could use options strategies like straddles to profit from price swings in either direction over the next few weeks.
