The International Energy Agency has reduced its forecast for global oil supply in 2026 as renewed Middle East hostilities and the continued inability to reopen critical shipping routes intensify concerns over a widening market deficit.
According to the agency’s latest monthly oil market report, global supply is expected to decline by 4.3 million barrels per day this year, representing roughly 4% of overall output. The forecast has been lowered as fighting in the Middle East since July continues to disrupt the outlook for crude production and transportation.
“With an agreement enabling the reopening of Hormuz and unhindered transit through the Bab el-Mandeb Strait still elusive, we have again lowered supply estimates for the rest of the year,” the IEA said.
The revised figure is larger than the 3.7 million barrels-per-day decline projected in the IEA’s July report. As a result, the agency now expects global oil supply to total 102.02 million barrels per day in 2026, its lowest estimate for the year so far.