IEA Forecasts First Global Oil Demand Decline Since 2020 in 2026

MOSCOW, July 10. /TASS/. The International Energy Agency (IEA) forecasts a decline in global oil demand of 1.047 million barrels per day (bpd) in 2026, which would mark the first contraction since 2020, according to the agency's report.

At the same time, the agency slightly improved its demand outlook following second-quarter oil supply data that came in marginally better than expected. The IEA now projects a decline of 1.047 million bpd, compared to its June estimate of a 1.1 million bpd drop.

The IEA noted that oil demand fell by 5.3 million bpd in May to 97.9 million bpd, hitting its lowest level this year. However, following the ceasefire agreement between the US and Iran, oil exports through the Strait of Hormuz and overall oil demand increased.

According to the agency, significantly lower oil prices are also stimulating growth in oil consumption and improving the economic outlook. The pace of the annual decline in demand is expected to moderate from an average of 4.8 million bpd in the second quarter of 2026 to 1.7 million bpd in the third quarter, followed by a 1.2 million bpd increase in demand in the fourth quarter as the market returns to growth in October, the IEA added.

According to the forecast, global oil demand in 2026 will total 103.463 million bpd, down from 104.51 million bpd in 2025. In 2027, the agency expects oil demand to reach 105.469 million bpd.