Overview
- The IEA's monthly report on Friday cut 2026 global oil demand by about 2.5 million barrels per day and reduced its 2026 global supply outlook by roughly 1.4 million bpd compared with last month.
- The agency lowered Russia's crude output forecasts to about 8.7 million bpd in 2026 and 8.6 million bpd in 2027 while warning that repeated Ukrainian strikes and sanctions could shrink Russian refining capacity by about 30% over the next 18 months.
- Saudi reported production fell sharply in August to roughly 6.24 million bpd, the lowest monthly figure since 1990, as Houthi strikes on Red Sea export routes and western facilities cut loadings and forced re-routing; Saudi communications to OPEC also show a higher market supply figure of 7.1 million bpd that month.
- The US Energy Information Administration still forecasts a record US crude output of about 13.8 million bpd in 2026 but that rise is only partly offsetting lost Gulf, Russian and Iranian seaborne volumes, leaving markets tight and benchmarks above $100 per barrel.
- Global inventories and refined product stocks are at strained levels with diesel especially tight, meaning further attacks, sanctions or export blockades could deepen shortages and prolong elevated prices into 2027.