IEA Slashes Oil Demand Forecast Amid Economic Uncertainties

The International Energy Agency (IEA) has revised its forecast for global oil demand, projecting that it will rise more slowly than expected this year. According to the IEA's monthly oil report, world oil demand is set to increase by 850,000 barrels per day (bpd), down 80,000 bpd from last month's forecast.

The agency attributed the slowdown in demand growth to 'economic uncertainties and higher oil prices', which are weighing on consumption. In contrast, global supply has risen faster than demand due to output hikes by OPEC+ and other producers such as the US, Guyana, and Brazil.

Despite the surplus, the IEA still projects a sizeable global oil supply surplus in 2026 of 3.73 million bpd, which is broadly unchanged from last month's forecast. This would equal almost 4% of world demand.