IEA Sees Wider Oil Supply Deficit Despite Hit to Demand From War

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Or sign-in if you have an account.(Bloomberg) — Global oil inventories will tumble this quarter at more than twice the rate previously estimated as the Iran war flares again, even as the hit to demand from high prices deepens, the International Energy Agency said. THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountOil markets face a shortfall of 1.8 million barrels a day as “renewed hostilities and maritime disruptions” undermine a production recovery, the IEA said in its monthly report. For 2026 as a whole, the deficit will likely be the widest in five years.Stockpiles are tightening again even as elevated fuel prices prompt the agency to deepen estimates for this year’s decline in global oil demand by almost 50% to 1.6 million barrels a day. That’s the biggest slump in annual average terms since the 2020 Covid pandemic.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againWhile a brief ceasefire between the US and Iran in mid-June revived oil exports from the Persian Gulf, shipping and regional energy infrastructure are once again under fire. That’s pushing up the cost of fuels such as gasoline and diesel — the workhorse of the global economy — and squeezing consumers. Still, the output declines are far smaller than some of the worst-case scenarios painted early in the war, having been tempered by an array of workarounds. Those include alternative pipelines used by Saudi Arabia and the United Arab Emirates and a network of shuttle tankers plying the Strait of Hormuz. US Energy Secretary Chris Wright said Tuesday that 9 million barrels a day has escaped in the past week, almost half prewar volumes.The world’s depleted inventories ought to be replenished next year after oil markets tip back into oversupply, according to the Paris-based IEA. Members of the organization such as the US, Japan and Germany will need to refill emergency oil reserves after announcing a record release of stocks in March, it said.“Although the market is projected to return to surplus towards the end of this year, risks remain substantial and the urgency of reopening the Strait has increased, as previously available inventory buffers are rapidly depleting,” the agency said.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.