OPEC Cuts Oil Demand Growth Forecast Amid Iran War Turmoil

OPEC's latest forecast for global oil demand growth has been cut by 500,000 barrels per day in 2026 due to the ongoing Iran war. This reduction is in addition to a previous cut of 500,000 bpd, making a total decrease of 1 million bpd from earlier expectations.

The war's impact on oil demand is significant, with global oil demand expected to average 104.57 million barrels per day in the second quarter, down from 105.07 million bpd forecast last month. The Strait of Hormuz closure has curbed millions of barrels of Middle East output, sending fuel prices soaring and prompting government steps to conserve supplies.

OPEC+ output dropped by 1.74 million barrels per day in April due to the closure of the Hormuz route, which is a key global oil route. The group had agreed to resume output increases from April but was unable to deliver on this deal. OPEC's forecast for 2027 demand growth has been raised by 200,000 bpd to 1.54 million bpd.