The Organization of Petroleum Exporting Countries (OPEC) announced on Tuesday in its Monthly Oil Market Report (MOMR) that it is keeping its demand growth predictions for this year unchanged at 4.2 million barrels per day (bpd). The world average consumption is expected to hit 100.8 million bpd, which is higher than pre-COVID levels.

OPEC stated that the Omicron impact was moderate and short-lived, confirming its December position when it made no significant revisions to demand predictions.

Following the conclusion of Q4 2021, OPEC has raised its oil demand projection for the last quarter of 2021, “primarily to account for stronger-than-expected demand in the Americas and the Asia Pacific, as well as the appearance of the new COVID -19 variant (Omicron).”

OPEC does not expect monetary actions from the Fed and other central banks. OPEC said: “In summary, monetary actions are not expected to hinder underlying global economic growth momentum, but rather serve to recalibrate otherwise overheating economies. With an ongoing robust oil demand forecast, and the continuing efforts of OPEC Member Countries and non-OPEC countries participating in the DoC, the oil market is expected to remain well-supported throughout 2022.”

The advent of new versions following Omicron, as well as supply chain constraints that could stifle some of the momentum, are both important uncertainties for 2022, according to OPEC.

The cartel’s oil output estimates for December are likewise a positive sign for the oil market. For the second month in a row, OPEC’s output increase fell short of what it was entitled to under the agreement. According to OPEC’s secondary sources, crude oil production increased by 170,000 barrels per day last month, compared to the 253,000 barrels per day allowed under the OPEC+ pact.