IEA Warns Global Oil Supply on Brink of Collapse Amid Middle East Tensions
The International Energy Agency (IEA) has issued a stark warning about global oil supply losses amidst escalating tensions in the Middle East. The Strait of Hormuz and Bab al-Mandeb are key chokepoints for oil shipping, and conflict in these regions is taking its toll on supply.
In its latest monthly report, the IEA lowered its outlook for global oil supply in 2026 by a significant margin. It now expects a decline of 4.3 million barrels per day (bpd) this year, up from its previous forecast of 3.7 million bpd issued in July.
This represents a 4% reduction in global oil supply and would leave it around 1.27 million bpd below demand. The IEA also forecasts a deficit of 1.8 million bpd between July and September, marking the largest quarterly shortfall since 2021.