IEA Trims Oil Supply Forecast Amid Iran Conflict and Geopolitical Tensions
The International Energy Agency (IEA) has reduced its forecast for global oil supply in 2026 by 6%, expecting a decline of 5.7 million barrels per day compared to last year. This downward revision is attributed to ongoing conflict in Iran, which is delaying Middle East oil flows.
The IEA also revised down global oil demand for 2023, predicting a drop of 2.5 million barrels per day due to geopolitical tensions, including attacks near the Strait of Hormuz and the Yemen conflict. The agency warns that shrinking inventories and strained refining capacity could tighten markets further.
Oil prices remain volatile, with benchmarks near $100 per barrel amid these tensions. The IEA emphasizes the need for diplomatic progress to avoid worsening supply constraints and demand destruction.