IEA warns of oil supply shortage
The International Energy Agency has lowered its global oil supply forecast for 2026, expecting a decline of about 4.3 million barrels per day to 102 million barrels per day. This reduction is due to disruptions in crude flows from the Middle East and Russia. The agency also forecasts the market gap to widen to 1.8 million barrels per day during the third quarter, as renewed fighting and shipping disturbances persist. Furthermore, the agency predicts oil demand will contract by approximately 1.6 million barrels per day in 2026, with a drop of 2.8 million barrels per day expected in the third quarter before returning to growth in the last quarter and in 2027. On the supply side, global production increased by 2.4 million barrels per day in July but remains 6.3 million barrels below pre-pandemic levels, with ongoing disruptions in the Middle East and declining exports, especially through the Strait of Hormuz. Additionally, global oil inventories fell to their lowest level since April 2025, reaching 69 million barrels in July, due to reduced tanker stockpiles, as production and export disruptions continue. This has driven oil prices up to near $92 per barrel.
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