IEA Cuts Oil Demand Forecast Amid US-Iran Standoff and Gulf Crisis
The International Energy Agency (IEA) has reduced its forecast for global oil demand in 2026, citing the ongoing US-Iran diplomatic standoff and increased security risks in the Gulf region.
The IEA now expects a 2.5 million barrel per day decline in oil demand in 2026, which is 940,000 barrels per day steeper than its previous forecast. This revised projection suggests that 2026 will be a trough year for global oil consumption, rather than a structural break.
The agency attributed the decline to record product prices and supply disruptions caused by the Gulf crisis. Demand for diesel and gasoil has been particularly affected, with prices sitting at 94% above pre-war levels.
Inventories have drawn down significantly, with observed stocks falling by 95 million barrels in August and cumulative draws reaching 507 million barrels since February.