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Informist, Wednesday, Aug. 12, 2026

 

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--IEA: See global oil demand fall 1.6 mln bpd 2026; steep fall from prev view
--IEA had previously forecast demand to decline by 1 mln bpd in 2026
--IEA: See global oil demand grow in Q4 2026, expand by 2.4 mln bpd 2027 
--IEA: Global oil supply rose 2.4 mln bpd to 101.5 mln bpd in July
--IEA: July global oil supply was 6.3 mln bpd below yr-ago levels
--IEA: See global oil supply decline by 4.3 mln bpd in 2026
--IEA: See global oil supply rebounding by 8.3 mln bpd to 110.3 mln bpd 2027
--IEA: Global oil stocks plunged 69 mln bbl Jul on renewed W Asia disruptions

 

NEW DELHI – The International Energy Agency has forecast global crude oil demand to contract by 1.6 million barrels per day in 2026 as the prolonged closure of the Strait of Hormuz and high fuel prices continue to weigh on crude oil consumption. In July, the agency had projected global oil demand to decline by 1 million barrels per day, on the hope that supplies would recover in the months to follow.

 

Amid higher crude oil prices, the agency has forecast demand to contract by 2.8 million barrels per day in the third quarter of 2026 after a decline of 4.9 million barrels per day in the June quarter. It is only in the final quarter of 2026 that the agency sees global crude oil demand growing by 580,000 barrels per day. In 2027, global oil demand is projected to expand by 2.4 million barrels per day, as the agency expects supply chains to normalise and crude oil prices to ease.

 

On supply, the agency said global oil flows rose by 2.4 million barrels per day to 101.5 million barrels per day in July, but remained 6.3 million barrels per day below the year-ago levels as output from the Gulf is still shut in. "Renewed hostilities and maritime disruptions in July and early August undermined the recovery efforts," it said in its August oil market report.

 

Regional exports, including routes bypassing the Strait of Hormuz, fell sharply by 2.1 million barrels per day to 15 million barrels per day in July. With agreements enabling the reopening of the Strait of Hormuz and unhindered transit through the Bab el-Mandeb Strait connecting the Red Sea to the Gulf of Aden and the Indian Ocean remaining "elusive", the agency has further lowered its supply forecasts for the rest of the year.

 

It has forecast global oil supply to decline by 4.3 million barrels per day to 102 million barrels per day in 2026, as growth from the Americas can only partly offset losses from West Asia and Russia. Global oil supplies are expected to rebound by 8.3 million barrels per day to 110.3 million barrels per day in 2027.

 

In July, global refinery throughputs rose by 1.8 million barrels per day but remained nearly 5 million barrels per day from year-ago levels. The agency expects global refinery runs to decline by 2.5 million barrels per day in 2026 before rebounding by 3.5 million barrels per day in 2027.

 

Global observed oil inventories plunged by 69 million barrels in July as renewed disruptions to exports from the Persian Gulf and the Caspian Sea resulted in sharply lower volumes of oil on water, the agency said. "By the end of July, observed stocks had fallen below 7.9 billion barrels for the first time since April 2025," it said.

 

Benchmark crude oil prices moved in an "exceptionally wide range of almost $40/bbl" in July amid intermittent geopolitical tensions and tightening supply. At 1544 IST, the most-active October contract of crude oil on NYMEX was down 0.3% at $81.67 per barrel.  End

 

US$1 = INR 95.33

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Afra Abubacker

Edited by Rajeev Pai

 

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