Directly contradicting OPEC, the International Energy Agency predicted that global oil supply would rise quickly than expected in 2025-2026, forecasting a 2.5 million b/d output hike this year, up 400,000 b/d compared to its previous outlook, citing OPEC+ unwinding.
OPEC hikes 2026 Oil Demand Outlook. Running counter to industry consensus, OPEC lifted its demand growth forecast for next year by 100,000 b/d to 1.38 million b/d in its monthly report, keeping 2025 numbers unchanged, whilst cutting non-OPEC+ supply growth to 630,000 b/d.
The latest IEA Oil Market Report (August 2025) projects global oil demand growth to slow to 700 kb/d this year and next, with weaker-than-expected consumption in emerging and developing economies. While jet fuel demand is robust, overall demand growth is the lowest since 2009, excluding the 2020 COVID year. Global oil supply is projected to increase, led by OPEC+ and non-OPEC+ producers, with refinery runs also expected to rise.
The IEA has repeatedly downgraded its global oil demand growth forecasts for 2025, with the current estimate at 700 kb/d, reflecting lacklustre demand in major economies and emerging markets. Consumption in countries like China, Brazil, Egypt, and India has been revised downwards compared to the previous month. Aviation is an exception, with robust summer travel pushing jet fuel demand to record highs, particularly in the US and Europe.
Global oil supply is projected to rise, with both OPEC+ and non-OPEC+ producers contributing to the increase. Refinery throughputs are also expected to increase, reaching a seasonal peak in July and August. Refining margins eased in June but recovered in early July, driven by stronger diesel cracks.
Global observed oil inventories were down in November, reaching their lowest level since July 2022, according to the IEA. Red Sea tensions and geopolitical concerns have influenced oil prices, with futures recovering from mid-December lows. Russian oil exports rose to a nine-month high in December, according to the IEA.
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