There are good signs for healthy oil demand going into 2026, energy industry leaders said on Monday at the ADIPEC energy conference in Abu Dhabi, after OPEC+ decided to pause output increases in the first quarter of next year.

When asked about the possibility of an oil glut in 2026, the United Arab Emirates’ Energy Minister Suhail al-Mazrouei said: “I am not going to talk about an oversupply scenario,” adding that “I think all of what we are seeing is more demand.”

OPEC Secretary-General said at the same event that there are good signs for demand and that surprises are not expected in the market.

“We are making sure we maintain the supply-demand balance,” Haitham Al Ghais said of Sunday’s OPEC+ decision.

OPEC+ countries, which include the UAE, agreed to increase December output targets, but halted the increases in the first quarter of 2026 to moderate plans to regain market share on fears of a supply glut.

New Western sanctions on OPEC+ member Russia are adding to the challenges, as Moscow may struggle to further raise output after the U.S. and Britain imposed fresh measures on top producers Rosneft and Lukoil.

OPEC+ HAS FLEXIBILITY TO ALTER DECISIONS

Ghais said that while the group has been consistently returning barrels to the market, it still has the flexibility ‘to alter, pause, or reverse’ its decisions.

OPEC+, which pumps about half of the world’s oil, has been unwinding voluntary cuts, after cutting back production for several years to support the market.

Oil demand growth is seen at 1.3 million bpd this year, Ghais said, adding that a peak in oil demand would not be seen any time soon.

The last element of the cuts for the whole group is meant to stay in place until the end of 2026. Eight OPEC+ members will meet again on November 30, the same day as a full OPEC+ meeting.

Mazrouei said OPEC+ is trying to achieve balance, but investments are needed because artificial intelligence and data centres require more energy.

“There is a requirement for more energy … and we need to make sure the environment for investment is allowed to do that,” he said.

“If we’re not achieving a balance between the price and what you would require, we will not have (a sufficient flow of investment) to do it.”

‘VOLATILITY IS THE NORM’

UAE oil firm ADNOC’s chief executive said volatility became a constant due to geopolitics and near-term uncertainty was real. But long-term demand remained strong, he said, adding that oil demand would stay above 100 million barrels a day beyond 2040.

“While we may face headwinds in the months ahead, the long-term outlook shows demand growth for every form of energy across every market,” Sultan Al Jaber said.

Al Jaber said that cost discipline needed to be balanced with capital investment.

Electricity demand will keep surging through 2040 as the power required by data centres continues to grow, but a shortage of gas turbines is turning a supply crunch into a “choke point” that is sending electricity prices higher, Al Jaber said.

More than $4 trillion in capital investment is needed annually to cover grids, data centres and all sources of energy supply, he added.

The capital is available but needs to be derisked, Jaber added, saying the right structures need to be in place to ensure the flows are going where they are needed.

He added that “dormant capital” tied up in existing energy infrastructure needs to be freed up.

XRG, ADNOC’s international investment arm, continues to look for opportunities across the gas value chain. Source: Reuters