Global Oil Demand to Hit New Record in 2024 - The Road to Autonomy

Global Oil Demand to Hit New Record in 2024

Dean Foreman, Chief Economist, Texas Oil & Gas Association joined Grayson Brulte on The Road to Autonomy podcast to discuss the global record demand for oil and the Texas economy.

The conversation begins with Dean discussing the current state of the oil markets.

In a nutshell they are deceptively tighter than relativity modest prices, of plus or minus $70 a barrel recently would indicate.

– Dean Foreman

Even though we are currently in a tight oil market, global oil demand is projected to increase to 102.7 million barrels per day in 2024  — a record high. If the economy stays on track and continues to hum along and not fall into a recession, the oil supply pressures could continue to mount.

Historically in a rising rate environment, the demand for oil and commodities in general has decreased. This time however, we are seeing the demand for oil continuing to be strong. The increased demand for oil is primarily coming from emerging markets.

We’re seeing emerging markets drive the majority of economic growth this year, projected again over the next two years and hand-in-hand with that has come the energy demand to go with it.

– Dean Foreman

If the demand for oil continues as projected, The United States can bring more supply online. In the United States, Texas currently produces 5.4 million barrels per day of oil. With global demand for oil increasing, Texas’ economy has led the nation in economic growth for the last two quarters.

Texas economy is growing at an average annual pace of 7.6%, more than 2.5 times the U.S. average. From January 2023 to April 2023, Texas generated $73.2 billion of state export revenues.

When Texas does well, the U.S. does well.

– Dean Foreman

With 43.6% of the oil in the United States being produced in Texas, the industry puts safe guards in place to protect against the potential impacts of hurricanes to ensure that oil can continue to flow.

Wrapping up the conversation, Dean shares his outlook for the global oil markets and what he expects to see occur over the next quarter.

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Recorded on Friday, July 7, 2023