IEA predicts historic decline in global oil demand

The International Energy Agency predicts a decline in global oil demand this year.

The decline in oil demand in 2026 will be comparable in scale to the four biggest shocks of the last 60 years, the IEA report says.

MOSCOW, September 11 - RIA Novosti. The decline in global oil demand this year will be comparable to the oil crises of the 1970s, as well as the economic crisis of 2008 and coronavirus restrictions in 2020, the International Energy Agency (IEA) predicts.

“The decline in oil demand in 2026 is likely to be comparable in magnitude to the four biggest shocks of the last 60 years,” the IEA said in its monthly report.

“The twin oil crises of the 1970s, caused by supply shocks caused by the 1973 Arab oil embargo and the 1979 Iranian revolution and its aftermath, sharply reduced the rate of global demand growth and put it on a lower trajectory,” it says.

“This century, the Great Financial Crisis of 2007-08 and the Covid-19 pandemic led to a decline in demand, but consumption has since returned to its previous growth rates,” the IEA adds.

The agency notes that previous demand downturns of this magnitude have invariably been followed by protracted periods of recovery and structural shifts. Thus, the IEA's forecast for a rapid and complete recovery of the global economy next year, with a slight sustained decline in demand, could be significantly reduced, the report notes.