Source: Sharecast
Global oil supply growth has been revised to 2.5m b/d this year, from 2.1m b/d previously, after the members of the oil cartel agreed on 3 August to raised production by another 547,000 b/d next month, fully unwinding the 2.2m b/d cuts put in place since April.
The Paris-based IEA also raised its supply growth forecast for 2026 to 1.9m b/d from 1.3m b/d.
The upgrade comes despite repeated downgrades to global oil demand growth estimates – 350,000 b/d in total – since the start of the year.
As a result, global oil demand is projected to increase by just 700,000 b/d a year over 2025 and 2026, meaning supply will grow at roughly three times the rate of demand.
"The latest data show lacklustre demand across the major economies and, with consumer confidence still depressed, a sharp rebound appears remote," the IEA said.
"Consumption in emerging and developing economies has been weaker than expected, with China, Brazil, Egypt and India all revised down compared with last month’s Report."
Nevertheless, while the supply-demand balance appears uneven, the IEA said that recently announced additional sanctions on Russia and Iran may curb supplies from the world’s third and fifth largest producers, respectively.