The International Energy Agency (IEA) and OPEC lowered their 2026 global oil demand forecasts. Both organizations cited the Middle East conflict, high energy prices, and a weak economic outlook for the revisions.
The IEA expects world oil demand to contract by 420,000 barrels per day this year. This forecast marks a significant reversal from previous growth projections. OPEC similarly reduced its 2026 demand growth projections in its latest monthly report.
The reports highlight a severe supply shock following the closure of the Strait of Hormuz. This closure has depleted global oil inventories at a record pace. These dual downgrades signal that demand destruction is beginning to impact the energy sector.