Oil Prices Plummet on Downgraded Demand Forecasts

Oil prices plummeted by over $1 per barrel on August 13 as forecasters downgraded global demand expectations for 2026. The Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA) both revised their outlooks, citing disruptions caused by the US and Israeli war against Iran.

The IEA expects oil consumption to decline by 1.6 million barrels per day this year, a more significant drop than previously projected. OPEC's forecast for global oil demand growth in 2026 was also lowered to 580,000 barrels per day.

However, the market remains tense due to ongoing supply risks from the Middle East and diplomatic stalemate between Iran and the US. The lack of progress in talks between Washington and Tehran is preventing a deeper decline in prices.