Global oil demand has begun to recover as shipments through the strategically important Strait of Hormuz resume and prices continue to ease, the International Energy Agency (IEA) said on Friday.
“Global oil demand is recovering, with consumption rebounding from its low point in May,” the IEA said in its monthly report.
In June, the agency had forecast that global oil demand in 2026 would decline by 1.1 million barrels per day due to the war in the Middle East, which disrupted shipping through the Strait of Hormuz. It has now revised that forecast, expecting demand to fall by 1 million barrels per day instead.
“Global oil supplies rose sharply by 4.1 million barrels per day in June to 98.8 million barrels per day as the resumption of shipping through the Strait of Hormuz enabled a partial recovery in Persian Gulf production. However, global output remained around 9.4 million barrels per day below pre-war levels,” the agency said.
According to the IEA, total Persian Gulf oil exports, including volumes transported via routes bypassing the Strait of Hormuz, increased by 6.5 million barrels per day in June to 16.1 million barrels per day. Although this represents a significant increase, exports remain well below the pre-war average of 24 million barrels per day recorded before the conflict began in late February.
The IEA said global oil supply improved to 102.6 million barrels per day in June and is expected to continue increasing if the recent de-escalation of hostilities is sustained.
“If transit volumes continue to recover, global oil supply could increase by 7.5 million barrels per day next year,” the agency added.
The IEA also reported that global oil inventories increased for the first time since the United States and Israel launched strikes against Iran on 28 February, triggering the conflict in the Middle East.
At the same time, oil stockpiles in advanced economies continued to decline, as imports remained relatively low despite higher seaborne shipments.
Although oil prices fell sharply in June, renewed fighting between U.S. and Iranian forces this week has once again clouded the outlook, the agency warned.
“The renewed clashes in the Persian Gulf this week highlight the risks associated with the failure to secure a lasting peace agreement, which is essential for the normalisation of global oil markets,” the IEA concluded.
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