IEA Cuts 2026 Oil Demand Outlook Amid Gulf Disruptions, Sees Recovery Taking Shape in 2027
Key takeaways
- The agency now expects global oil demand to contract by 1.1 million barrels per day next year, a significant deterioration from its previous forecast for a decline of 420,000 barrels per day.
- Looking ahead, the IEA anticipates demand growth will return in 2027, with consumption rising by 2 million barrels per day as energy markets stabilize, trade routes recover and broader economic conditions improve.
- The United States and Iran have reached a preliminary accord aimed at ending hostilities, with a formal signing ceremony expected on Friday.
IEA Cuts 2026 Oil Demand Outlook Amid Gulf Disruptions, Sees Recovery Taking Shape in 2027 Fiona Craig Sat, June 20, 2026 at 11:12 PM GMT+7 3 min read CL=F Engineer standing in front of an oil derrick ©mohamed mahmoud hassan The International Energy Agency (IEA) has sharply downgraded its outlook for global oil demand in 2026, citing the impact of the Gulf supply crisis, while forecasting a gradual restoration of flows through the Strait of Hormuz that could reach 8 million barrels per day by 2027.
The agency now expects global oil demand to contract by 1.1 million barrels per day next year, a significant deterioration from its previous forecast for a decline of 420,000 barrels per day. The revision reflects elevated energy prices and major supply disruptions linked to the regional conflict.
Looking ahead, the IEA anticipates demand growth will return in 2027, with consumption rising by 2 million barrels per day as energy markets stabilize, trade routes recover and broader economic conditions improve.