IEA Cuts 2026 Oil Demand Growth to 850,000 Bpd


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) -- The International Energy Agency (IEA) on Thursday 
(2/12) lowered its global oil demand growth forecast for 2026, saying higher 
crude prices and economic uncertainty will likely weigh on consumption.

   The Paris-based agency now expects demand to rise by 850,000 bpd this year, 
a decrease from the 930,000 bpd growth projected in its January report. High 
prices in early January weighed on growth prospects despite continued demand 
from non-OECD economies and the petrochemical sector, the IEA observed.

   World oil supply fell by 1.2 million bpd in January to 106.6 million bpd due 
to severe winter weather and outages. Disruptions in North America and 
Kazakhstan, along with export constraints in Russia and Venezuela, drove the 
sharp monthly decline in output.

   The IEA maintained its 2026 supply growth forecast at 2.4 million bpd, 
assuming OPEC+ members continue their current production agreements.

   With total supply for the year projected at 108.6 million bpd against an 
implied demand of 104.9 million bpd, annual surplus will likely remain 
unchanged at the 3.7 million calculated in January, the IEA's latest report 
implied.

   Global oil inventories rose by 37 million bbl in December, bringing total 
builds for 2025 to 477 million bbl -- the highest annual increase since the 
2020 pandemic that decimated demand. Preliminary data for January suggests 
stocks surged by another 49 million bbl as supply continues to outpace demand.

   Refinery activity dropped from December's record high of 86.3 million bpd to 
85.7 million bpd in January due to seasonal maintenance and lower margins. The 
agency predicts refinery runs will increase by 790,000 bpd this year, led 
primarily by growth in non-OECD regions.

   Benchmark oil prices rose steadily in January, with North Sea Dated crude 
climbing $10 bbl over the month. Geopolitical tensions and North American 
snowstorms sparked the bullish reversal, though the IEA still warns of a 
looming global glut.

    




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