IEA and OPEC Split on 2026 Oil Demand Outlook

The world's two most influential oil market forecasters presented sharply conflicting outlooks for 2026 on Wednesday, with the International Energy Agency (IEA) projecting the first annual decline in global oil demand since the pandemic, while OPEC maintained its forecast for consumption growth. The divergence comes as the closure of the Strait of Hormuz continues to disrupt global energy flows.

In its August Oil Market Report, the Paris-based IEA now expects global oil demand to fall by 1.6 million barrels per day (mbd) in 2026, a downward revision of 510,000 barrels per day from its July forecast. The agency cited the ongoing closure of the Strait of Hormuz and elevated fuel prices as key factors weighing on consumption. "The ongoing closure of the Strait of Hormuz and elevated fuel prices continue to weigh on oil consumption," the IEA stated, cutting its second-half forecast by roughly 550,000 barrels per day.

In contrast, the Organization of the Petroleum Exporting Countries (OPEC) still projects demand growth for 2026, though it has trimmed its estimate for a fourth consecutive month to 580,000 barrels per day, down from 780,000 barrels per day. The producer group has...