Oil Prices Slide on Slashed Demand Forecasts and Surging US Inventories
Oil prices fell in Asian trading on Thursday despite ongoing tensions between the US and Iran. The decline was driven by cuts to 2026 oil demand forecasts from both OPEC and the International Energy Agency (IEA). Brent Crude prices dropped 0.5% to trade below $89 per barrel, while WTI Crude traded 0.60% lower at $82.77.
The IEA slashed its oil demand forecast for 2026 by 1.6 million barrels per day, citing the renewed hostilities in the Strait of Hormuz and the stalemate in US-Iran talks. OPEC also cut its demand growth forecast for 2026 to 580,000 barrels per day, down from 780,000 previously.
A surprise build in US crude oil inventories further weighed on prices, with a massive increase of 17.4 million barrels during the week ending August 7. This brings commercial stockpiles to 424.4 million barrels, just 2% below the five-year average for this time of year.