OPEC raised its forecast for global oil demand growth this year in hopes that the pandemic will subside, helping the organization and its allies in their efforts to support the market.
Demand will grow by 5.95 million barrels per day in 2021, or 6.6%, predicts the OPEC, which is 70,000 barrels per day more than last month.
However, OPEC downgraded its forecast for the second quarter.
As the spread and severity of the COVID-19 pandemic is expected to decrease with the ongoing roll-out of vaccination programs, social distancing requirements and travel restrictions are likely to be reduced, allowing for increased mobility, the OPEC report said.
Further recovery could strengthen the position of OPEC and its allies, known as OPEC +, to further ease the record cut in oil production last year.
Oil was trading at around $ 64 a barrel before the report was released. Prices have climbed to pre-pandemic highs this year and surpassed $ 70, boosted by hopes for economic recovery and limited OPEC + supply.
OPEC has raised its forecast for global economic growth for 2021 from 5.1% to 5.4%, suggesting that the impact of the pandemic will significantly decrease by the beginning of the second half of the year.