IEA Trims Oil Supply Forecast Amid US-Iran Standoff

The International Energy Agency (IEA) has reduced its forecast for global oil supply in 2026, citing ongoing tensions between the US and Iran. The agency's report states that world oil supply is projected to fall to 100.7 million barrels per day next year.

This represents a decline of 5.7 million barrels a day from last year's forecast and 1.3 million barrels lower than its estimate in August. The IEA attributes the decrease to the 'protracted US-Iran diplomatic standoff' and renewed attacks in the Persian Gulf and Red Sea.

The Strait of Hormuz has been an alternative route for oil flows, but production in excess of 10 million barrels per day remains suspended in Gulf countries. As a result, the IEA expects a full recovery in supplies from oil-producing Middle Eastern countries to be delayed until next year.