The IEA (International Energy Agency) has cut its 2026 global oil supply forecast, now expecting output to plunge by 4.3 million barrels per day this year due to the failure to reopen the Strait of Hormuz, pushing the market deeper into deficit.
This latest forecast is considerably worse than the 3.7 million bpd decline projected just last month. Furthermore, the IEA now expects a 1.8 million bpd deficit between July and September, a 1 million bpd downward revision from July.
The shutdown of Hormuz, the U.S. blockade of Iranian exports, attacks in the Bab el-Mandeb Strait, and reduced Kazakh CPC Blend exports are keeping global supply below demand.
The IEA also expects global oil consumption to contract by 1.6 million bpd this year, compared to a roughly 1 million bpd decline forecast in July.
