OPEC, supplier of 40 percent of the world’s oil, cut forecasts for the amount of crude it will need to supply for most of the next two decades as the shale-energy boom in the U.S. lessens dependency on the group.
Demand for crude from the Organization of Petroleum Exporting Countries may fall to a 14-year low of 28.2 million barrels a day in 2017, according to the group’s annual World Oil Outlook. That’s 600,000 a day less than last year’s report and 800,000 below the amount required this year. OPEC lowered every forecast for its crude through 2035 except next year, which will be higher than previously predicted. Still, Secretary-General Abdalla El-Badri predicted prices will rebound next year.
The group’s members face mounting competition in the U.S., where technological breakthroughs — hydraulic fracturing and horizontal drilling — have caused a surge in domestic production. Oil prices slumped into a bear market last month amid speculation OPEC won’t do enough to tackle a glut when it meets on Nov. 27 to discuss output.