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OPEC has reduced its forecast for oil supply growth from non-OPEC+ producers in 2025, now expecting an 800,000 bpd increase—down from 900,000 bpd previously. Weaker oil prices, driven by OPEC+'s quicker-than-expected output hike and U.S. tariffs, have put pressure on investments. Capital expenditure in non-OPEC+ exploration and production is projected to decline by 5% in 2025. The U.S. remains the leading contributor to global oil supply growth, though its projected output increase has also been revised downward. While demand growth forecasts remain steady, OPEC acknowledges potential challenges from reduced investments. A recent U.S.–China trade agreement is seen as a positive signal, potentially stabilizing trade flows despite elevated tariffs.

Key Highlights

# OPEC cuts non-OPEC+ supply growth forecast to 800,000 bpd.

# Oil prices face pressure from OPEC+ output hikes and U.S. tariffs.

# 2025 upstream investment outside OPEC+ expected to drop by 5%.

# U.S. oil output forecast lowered to 300,000 bpd growth.

# Trade deal between U.S. and China offers market optimism.

Oil prices have come under renewed pressure in recent weeks, following OPEC+'s faster-than-anticipated production increases for May and June, and ongoing trade tensions marked by U.S. President Donald Trump's new tariffs. These developments have contributed to a bearish sentiment in global oil markets, prompting OPEC to trim its non-OPEC+ supply growth outlook.

In its latest monthly report, OPEC revised down its 2025 forecast for oil supply growth from producers outside the OPEC+ alliance, now projecting an increase of 800,000 barrels per day—100,000 bpd lower than the previous estimate. The organization attributed this adjustment to weakening oil prices and a likely 5% year-on-year decline in capital spending on upstream exploration and production outside OPEC+. In 2024, E&P investment rose by $3 billion to reach $299 billion, but that trend appears to be reversing.

The United States remains a key driver of global oil supply, though its projected output growth for 2025 has also been revised lower—from 400,000 to 300,000 bpd. OPEC noted that the reduced investment environment could challenge production growth in 2025 and 2026, despite ongoing improvements in efficiency.

Meanwhile, OPEC has kept its global oil demand forecasts for 2025 and 2026 unchanged, citing balanced first-quarter data. In a positive development, the group welcomed a new 90-day trade agreement between the U.S. and China, which could support trade flow normalization, though likely under higher tariff conditions.

Finally

OPEC’s outlook reflects a cautious stance amid market volatility, with falling investments and geopolitical pressures adding to the uncertainty in global oil dynamics.

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