In this interview given to Christine Burke from Bloomberg TV, Dr. Carole Nakhle, CEO of Crystol Energy, assesses the risks facing oil market in 2025.

Key takeaways:
– Bearish sentiment dominates the 2025 outlook, with a widely anticipated market surplus as supply growth outpaces demand, while uncertainties remain centered on geopolitics.
– Under existing market trends, if OPEC+ begins unwinding its voluntary cuts in April 2025, a surplus is expected and that could lead to inventory build-ups and exert downward pressure on prices.
– 2024 was the year of confusion when it comes to oil demand outlook: For most of the year, we saw notable disparity between OPEC and IEA (more than 1Mb/d). While the IEA remained faithful to its subdued figures (nearly 800,000-1 Mb/d), OPEC stuck to its overly optimistic numbers for most of the year (2.2 Mb/d). However, in August it started its downward revisions. By the end of the year, it wrote off nearly 600,000 b/d from oil demand (total for 2024: 1.6 Mb/d). The difference in demand forecast between the two organisations in 2025 is less dramatic. OPEC expects 1.4 Mb/d (i.e. slower than 2024) and IEA 1.1 Mb/d.
- Asia continues to account for the lion share of oil demand growth but the Chinese engine has faltered. We are seeing more supportive monetary and fiscal policies in China, but the question remains whether this will be enough to spur growth significantly, without structural reforms.
- The health of major economies remains a key concern. According to the IMF, the global growth in 2025 is underwhelming.
– Elections dominated the headlines in 2024; 2025 will grapple with their consequences, with President Trump’s policies taking center stage.
– Geopolitics remains the biggest wildcard for 2025. Ongoing conflicts in the Middle East and between Russia and Ukraine continue to pose risks, with the potential for unexpected developments to disrupt markets.
– President Trump’s actions on critical issues remain uncertain, including his approaches to China, Russia, and Iran, as well as the practicality of his domestic energy ambitions.
Related Analysis
“Oil markets: Relative stability amid geopolitical strife“, Dr Carole Nakhle, Feb 2024
Related Comments
“Reasons for the decline in oil prices“, Dr Carole Nakhle, Aug 2024
“Growth outside OPEC+ robust“, Dr Carole Nakhle, Jul 2024