Oil Prices Slide on Reduced Demand Forecasts, US-Iran Conflict

Oil prices dropped on Thursday due to lowered global oil demand projections for 2026. The Organisation of Petroleum Exporting Countries (OPEC) reduced its forecast by 2% to 580,000 barrels per day in its monthly report.

The International Energy Agency (IEA) also cut its consumption projection from a million to 1.6 million bpd this year due to restricted fuel supplies and higher prices from the US-Israeli war on Iran.

Additionally, a surprise build in US commercial crude oil inventories last week put pressure on oil prices. The Energy Information Administration (EIA) reported a weekly gain of 17.4 million barrels, the largest since January 2023.

Despite these factors, the ongoing conflict and blocked talks between Iran and the US have kept prices elevated. A senior Iranian source stated that no progress had been made in reviving the interim deal agreed in June.