Key facts
- Global oil supply is now expected to fall by 5.7 million bpd in 2026.
- The IEA revised its 2026 global oil supply outlook downward by 1.4 million barrels per day.
- The agency expects normal Gulf supplies to return in 2027.
- Global oil stocks fell 3.1 million bpd in August, reaching their lowest since 2023.
- Saudi crude supply plunged 2.3 million bpd in August to 6 million bpd.
- OPEC+ production fell 1.8 million bpd to 38.8 million bpd in August.
The International Energy Agency (IEA) has significantly lowered its global oil supply forecast for 2026, now anticipating a plunge of 5.7 million barrels per day, a stark contrast to the 4.3 million bpd decline predicted just a month prior. This downward revision is largely due to the delayed recovery of Middle Eastern production, with the agency now expecting normal Gulf supplies to resume in 2027.
Global oil inventories experienced a substantial drawdown in August, falling at a rate of 3.1 million bpd, leaving total stocks at 7.8 billion barrels, the lowest level since 2023. Saudi Arabia was a major contributor to this decline, with its crude supply plummeting by 2.3 million bpd to 6 million bpd, its lowest in over three decades, following attacks on its facilities and shipping routes. Overall OPEC+ production decreased by 1.8 million bpd to 38.8 million bpd.
The supply crunch is already impacting demand, with the IEA now forecasting a 2.5 million bpd contraction in global oil consumption for this year, up from its previous estimate of 1.6 million bpd. Record fuel prices are compelling consumers to reduce usage, exacerbated by refinery disruptions that are tightening markets for diesel and other products. The IEA's demand forecast for 2026 is nearly 2.9 million bpd lower than OPEC's, though both agencies converge in their projections for 2027.