IEA: continued Hormuz disruptions strain global oil supplies and inventories

Global oil supply is now forecast to fall by 4.3 million bpd in 2026, the report says, as higher production from the Americas only partially offsets supply losses from the Middle East and Russia.

The strains from this are increasingly being felt in markets for refined oil products. Supply shortfalls and depleted stocks have tightened markets for diesel, jet fuel, and gasoline, pushing refining margins to record highs. The effects are also showing up in demand as higher fuel prices and disruptions to international supply chains weigh on consumption. The report forecasts that global oil demand will decline by 1.6 million bpd this year, a sharp change from before the war began at the end of February. At that time, global demand had been forecast to grow by 850 000 bpd in 2026.

For now, oil inventories continue to provide a critical buffer, with substantial stocks available globally. But as the disruption drags on, those inventories are being drawn down at a rapid pace. If regular flows through the Strait were to resume, it could push the global oil market back into a supply surplus towards the end of this year. But the report notes that the market outlook remains highly uncertain, given the volatile situation surrounding the Strait.

Read the full report from the IEA here.

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