IEA Downgrades 2026 Global Oil Demand Outlook

The International Energy Agency downgraded its 2026 global oil demand outlook to 103.29 million barrels per day, representing a decline of 1.56 million barrels per day. This latest revision is approximately 510,000 barrels per day lower than the agency's previous forecast, a shift driven by elevated fuel prices and persistent export disruptions through the strait of Hormuz.

Demand contracted by 4.9 million barrels per day during the second quarter of the year. Despite this slump, the agency expects a return to growth of 580,000 barrels per day in the final three months of 2026.

Looking toward 2027, the agency forecasts demand will grow to 105.7 million barrels per day. This projection assumes a de-escalation between the United States and Iran that allows oil flows to recover. Such a recovery would flip a projected 1.3 million barrel per day supply deficit in 2026 into a 4.6 million barrel per day surplus in 2027, which would enable countries to replenish commercial and strategic stocks.