June 22 (UPI) -- Given the pace of global economic development, oil demand is strong, but major investments are needed to keep up, the president of OPEC said Friday.
Ministers from the Organization of Petroleum Exporting Countries wrap up regular meetings in Vienna on Saturday. Early Friday, ministers agreed to put more barrels on the market daily to offset shortages from members like Venezuela.
Speaking at the start of Friday's summit, Emirati Energy Minister Suhail Mohamed al-Mazrouei said a cautious approach was necessary for a market exposed to heightened geopolitical risk. That said, the market was stabilizing on the back of strong economic growth.
"The global economy is strong, oil demand remains robust, the market is evidently rebalancing, and the return of more stability has been welcomed by all stakeholders," he said in his prepared remarks.
The United Arab Emirates holds the rotating presidency of OPEC.
OPEC economists in their monthly report for June said global oil demand is expected to average 98.85 million barrels per day, unchanged from its previous estimate. For the world's leading industrialized economies, however, the total demand forecast is expected to grow by about 40,000 barrels per day, an upward revision of 2,000 barrels per day from OPEC's previous estimate.
The Organization for Economic Cooperation and Development reported last week that real gross domestic product for the Group of 20 economies slowed slightly to 0.9 percent, down from first quarter growth of 1 percent. Australia recorded one of the strongest rebounds, with growth picking up from 0.5 percent to 1 percent. South Africa was one of the biggest losers, with GDP contracting by 0.5 percent.
Year-over-year, GDP growth in the G20 slowed from 4 percent to 3.9 percent in the first quarter of 2018. OPEC economists said their growth forecasts were balanced by OECD and non-OECD data.
Mazrouei, however, said long-term investments are necessary to keep pace with demand because oil demand is on pace to pass 111 million barrels per day in the next 20 years.
"The required global oil sector investment in OPEC's World Oil Outlook is estimated to be $10.5 trillion," he said.