International Energy Agency Expects Oil Demand to Fall by 1.6 Million Barrels per Day
The International Energy Agency (IEA) on Wednesday forecast a decline in global oil demand by 1.6 million barrels per day for the remainder of 2026, due to ongoing tensions in the Strait of Hormuz and rising fuel prices. This was reported in the IEA’s monthly report for August, released amid the continuing repercussions of the US-Israeli war on Iran on oil markets and the global economy.
The agency projected that “global oil demand will fall by 1.6 million barrels per day in 2026, an increase of 510,000 barrels per day compared to the IEA’s estimates in last month’s report, as a result of the continued closure of the Strait of Hormuz and higher fuel prices, which negatively affect oil consumption.”
The report added that “global oil supply rose by 2.4 million barrels per day to reach 101.5 million barrels per day in July, but remained 6.3 million barrels per day below last year’s levels, with Gulf production still halted by 8.3 million barrels per day.”
It noted that renewed hostilities and maritime disruptions in July and early August undermined recovery efforts, reducing oil supply forecasts for the third quarter of 2026 by 1.7 million barrels per day compared to last month’s report.
On July 14, the United States reimposed a naval blockade on Iran, under the direction of President Donald Trump.
Since February 28, the region has experienced waves of military confrontations, accompanied by stalled negotiations between the United States and Iran. The most prominent issue has been the strategic Strait of Hormuz, vital for energy supplies and trade.
On that day, the United States and Israel launched an attack on Iran, which resulted in 3,000 deaths, according to Tehran, which retaliated with attacks that killed Americans and Israelis.
Iran also launched attacks on what it described as US military facilities and equipment in regional countries, though some strikes caused civilian casualties and damaged civilian infrastructure.
