Source: Sharecast
Publishing its latest monthly report, the influential Paris-based body said shipments through the Strait of Hormuz were already on the rise.
It acknowledged that a full recovery would not be immediate, with shipping lanes needing to be cleared of mines and supply chains taking time to normalise. Overall, it expects the global oil supply to fall by 3.9m barrels per day, to 102.4m bpd, in 2026.
It also warned that while the interim agreement between the two countries paves the way for a "rebound" in Middle East exports, "operational and political constraints, including prolonged demining and unresolved transit arrangements, leave downside risks to the outlook".
But it continued: "If the deal holds, exports and production from the Gulf should see a gradual recovery, not least because Iranian oil exports can fully resume once the US blockade is lifted."
As a result, the IEA now expects global supply to grow by 8m bpd in 2027, outstripping forecast demand of 2m bpd.
The US first attacked Iran at the end of February. Hostilities spread quickly throughout the region, with a number of refineries and other sites either damaged or shuttered. The Strait of Hormuz became too dangerous to pass as Iran vowed to attack tankers, while the US subsequently announced its own blockade of Iranian oil exports.
The shock sent global energy prices soaring and weighed heavily on inventories. According to IEA estimates, more than 14m bpd of Middle East oil have been blocked by the conflict.
Washington and Tehran agreed a tentative peace deal over the weekend, which is due to be signed on Friday. Details are sparse, but the immediate cessation of all fighting and the Strait of Hormuz reopening are core elements.
Oil prices - which reached $120 at the peak of the war - fell sharply after the deal was announced. As at 1130 BST on Wednesday, Brent crude was trading at $79.08 and West Texas Intermediate at $76.25.