IEA Oil Market Report: 2025-2026 Monthly Analysis¶
Overview¶
This page synthesizes all 13 IEA Oil Market Reports published from January 2025 through March 2026, tracking the evolution of the agency's views on global oil supply, demand, prices, and stocks. The period covers one of the most dramatic arcs in recent oil market history: from post-pandemic normalization through a tariff-driven demand shock, an OPEC+ supply flood, and culminating in the catastrophic Strait of Hormuz crisis of February-March 2026.
Monthly Report Summaries¶
January 2025 -- "Turning up the heat"¶
Date: 15 January 2025
Key Data: - Brent crude: ~$81/bbl (surged past $80 on sanctions/cold weather) - 2024 demand growth assessed at 940 kb/d - 2025 demand growth forecast: 1.05 mb/d - Global supply: 103.5 mb/d (Dec), projected to rise by 1.8 mb/d in 2025 to 104.7 mb/d - Non-OPEC+ supply growth: 1.5 mb/d (both 2024 and 2025) - OECD industry stocks: 2,749 mb, 118 mb below 5-year average (lowest since Aug 2022) - Global observed stocks: 7,655 mb (Nov) - Refinery runs: 84.3 mb/d (5-year high, Dec)
Key Themes: - New US sanctions on Russia (10 Jan): targeted Gazprom Neft, Surgutneftegaz, 160+ tankers - Tighter sanctions on Iran's shadow fleet - Colder Northern Hemisphere winter boosting heating demand - US ethane boom driving LPG/ethane demand (+465 kb/d in 2024) - Petrochemical feedstocks account for ~2/3 of global consumption growth - China's post-lockdown demand upswing "essentially complete" - OECD demand essentially flat, non-OECD driving all growth
Warnings: Weather shut-ins risk (Cushing at decade lows), tariff uncertainty, EM currency weakness
February 2025 -- "Resilience and adaptation"¶
Date: 13 February 2025
Key Data: - Brent: rallied to $83/bbl early Jan, fell back to ~$75/bbl on trade war fears - 2024 demand growth revised DOWN to 870 kb/d (from 940) - 2025 demand growth revised UP to 1.1 mb/d (from 1.05) - Global supply: plunged 950 kb/d to 102.7 mb/d (Jan) on cold weather - 2025 supply growth: 1.6 mb/d to 104.5 mb/d - OECD industry stocks: 2,737 mb, 91 mb below 5-year average - Global stocks fell 17.1 mb in Dec, further 49.3 mb in Jan
Key Themes: - China fuel demand "flat in 2024 and already plateauing" - China's share of global demand growth slumped to 19% (vs 60% in prior decade) - India and Other Asia contributing combined 500 kb/d - Sanctions on Russia/Iran yet to materially impact supply - OPEC+ confirmed plans to start unwinding voluntary cuts from April - Crude oil markets were undersupplied in 2024 (crude production declined 120 kb/d) - Tight US crude balances -- Cushing at decade lows
Revisions from Jan: 2024 growth cut by 70 kb/d; 2025 growth raised 50 kb/d
March 2025 -- "Shifting sands"¶
Date: 13 March 2025
Key Data: - Brent: fell to ~$70/bbl (3-year lows) - 2024 demand growth: 830 kb/d (further cut from 870) - 2025 demand growth: "just over 1 mb/d" (~1.03 mb/d) - Global supply: rose 240 kb/d to 103.3 mb/d (Feb) - Non-OPEC+ supply growth: 1.5 mb/d in 2025 - Supply surplus: ~600 kb/d projected for 2025 - Global stocks fell 40.5 mb in Jan - OECD total stocks rose 11.2 mb (crude build)
Key Themes: - Escalating trade tensions/tariffs the dominant concern - Baker Bloom Davis Trade Policy Uncertainty Index at 40-year high - OPEC+ to start unwinding cuts in April (but actual increase ~50 kb/d vs nominal 138 kb/d due to overproduction) - Kazakhstan output at all-time highs (Tengiz ramp-up), 390 kb/d above quota - Venezuela supply expected to decline (Chevron license expiry) - GDP growth assumption: 3.1% (down 0.1 pp from Feb) - Gasoil demand fell 160 kb/d in 2024 -- continued weakness - "2024 marks the beginning of a period of slower and more fragmented global oil demand growth"
Revisions from Feb: 2024 growth cut by 40 kb/d; 2025 growth trimmed ~70 kb/d
April 2025 -- "Buckle up"¶
Date: 15 April 2025
Key Data: - Brent: plunged below $60/bbl (4-year lows), recovered to ~$65/bbl - 2025 demand growth: CUT by 300 kb/d to 730 kb/d (biggest single-month downgrade) - 2026 demand growth (first forecast): 690 kb/d - Global supply: 103.6 mb/d (Mar) - 2025 supply growth cut by 260 kb/d to 1.2 mb/d - 2026 supply growth: 960 kb/d - Global stocks: 7,647 mb (Feb), near bottom of 5-year range - GDP assumption: slashed to 2.4% for 2025 and 2.5% for 2026 (from 3.1%)
Key Themes: - "Liberation Day" tariff shock (2 April) -- paradigm shift in global economy - OPEC+ surprise: tripled scheduled production increase for May to 411 kb/d - US shale breakeven at $65/bbl average (Dallas Fed survey) - US oil supply forecast cut 150 kb/d (growth now 490 kb/d) - Chinese tariffs on US ethane/LPG impacting flows - OECD demand forecast to decline 200 kb/d in 2025, 240 kb/d in 2026 - Gasoline most price-elastic product; gasoil hardest hit by tariffs - Europe: Germany fiscal loosening partially offsetting tariff impact
Revisions from Mar: Demand cut 300 kb/d (largest single-month revision); GDP cut ~0.7 pp
May 2025 -- "In the balance"¶
Date: 15 May 2025
Key Data: - Brent: fell to $60/bbl (4-year low), rebounded to ~$66/bbl on US-UK and US-China trade deals - 2025 demand growth: 740 kb/d (+10 kb/d from April -- first upward revision since Jan) - 2026 demand growth: 760 kb/d - 1Q25 demand growth: 990 kb/d (robust) - Global supply growth: 1.6 mb/d to 104.6 mb/d in 2025; +970 kb/d in 2026 - OPEC+ adding 310 kb/d net in 2025, 150 kb/d in 2026 - Implied stock builds: 720 kb/d in 2025, 930 kb/d in 2026 - Russian crude prices all below $60/bbl price cap in April - Global stocks: 7,671 mb (Mar), 221 mb below 5-year average - GDP assumption: 2.8% for both 2025 and 2026
Key Themes: - OPEC+ second consecutive 411 kb/d increase for June - US shale producers trimming rigs, cutting capex up to 9% - US LTO production forecast cut for second consecutive month - Record EV sales curbing gasoline demand - Petrochemical feedstocks remain growth driver but disrupted by tariffs - Non-OECD delivery data weaker than expected (China, India) - Historical data revisions: Egypt and Nigeria consumption significantly higher than previously reported - GDP estimate improved 0.4 pp from April (tariff shock less severe)
Revisions from Apr: Demand +10 kb/d (first upgrade); supply revised up
June 2025 -- "Geopolitical risk in focus"¶
Date: 17 June 2025 (abbreviated report; concurrent Oil 2025 medium-term outlook published)
Key Data: - Brent: rallied to $74/bbl after Israel's 13 June air strikes on Iran - 2025 demand growth: 720 kb/d (marginally below May) - 2026 demand growth: 740 kb/d - Global supply: 105 mb/d (May), up 1.8 mb/d y-o-y - 2025 supply growth: 1.8 mb/d to 104.9 mb/d; +1.1 mb/d in 2026 - Russian exports fell 230 kb/d to 7.3 mb/d, revenues plunged $4B y-o-y - Global stocks rose 32.1 mb in April to 7,717 mb; surged further in May - Stocks built by 1 mb/d on average since Feb but still 90 mb below y-o-y
Key Themes: - MAJOR GEOPOLITICAL EVENT: Israel launched air strikes on Iran's nuclear and military facilities (13 June) - Fire at South Pars gas field (Iran); first Israeli attack on Iran's oil/gas sector - Iran threatened closure of Strait of Hormuz - Iran producing ~4.8 mb/d (crude+condensates+NGLs), exporting ~2.6 mb/d - 25% of world's oil supply transits Strait of Hormuz - Ceasefire agreed after initial exchange, prices eased - US-China 3-month tariff detente eased trade fears - China gasoline demand in sharp decline (-3.7% in 2025, -5.4% in 2026) -- EV impact
Revisions from May: Demand trimmed ~20 kb/d; supply revised up significantly
July 2025 -- "Disconnects"¶
Date: 11 July 2025
Key Data: - Brent: $65-$80/bbl range in June (geopolitical swing); ~$72/bbl at writing - 2025 demand growth: 700 kb/d (lowest since 2009 ex-Covid) - 2026 demand growth: 720 kb/d - 2Q25 demand growth: only 550 kb/d (sharp deceleration from 1.1 mb/d in 1Q25) - Global supply: surged 950 kb/d to 105.6 mb/d (Jun), up 2.9 mb/d y-o-y - 2025 supply growth raised to 2.1 mb/d to 105.1 mb/d; +1.3 mb/d in 2026 - Global stocks: surged 73.9 mb in May to 7,818 mb - Chinese crude stocks: +82 mb in 2Q25 (~900 kb/d) - US gas liquids stocks: +79 mb in 2Q25
Key Themes: - OPEC+ announced larger-than-expected August ramp-up of 550 kb/d - 80% of 2.2 mb/d voluntary cuts unwound; full unwinding possible a year ahead of schedule - Disconnect between bloated balances (1.74 mb/d implied stock builds in 2Q25) and healthy price indicators (backwardation, robust margins) - Chinese crude stockpiling driven by new Energy Law requiring strategic reserves for private companies - 2Q25 contractions in China (-160), Japan (-80), Korea (-70), US (-60), Mexico (-40) - India and Brazil demand growth halved vs start-of-year expectations - Saudi Arabia leading actual OPEC+ output increase
Revisions from Jun: Demand trimmed ~20 kb/d; supply growth raised sharply (+300 kb/d)
August 2025 -- "Beneath the calm"¶
Date: 13 August 2025
Key Data: - Brent: ~$70/bbl in July, slipped to $67/bbl in early Aug - 2025 demand growth: 680 kb/d (another cut) - 2026 demand growth: 700 kb/d - 2Q25 demand growth: 600 kb/d (entirely non-OECD; OECD flat) - Global supply: 105.6 mb/d (Jul); supply growth raised to 2.5 mb/d for 2025 - OPEC+ fully unwound 2.2 mb/d voluntary cuts (Nov 2023 tranche) by September - Refinery runs approaching all-time high of 85.6 mb/d in Aug - Global stocks: rose for 5th consecutive month in June to 7,836 mb (46-month high) - OECD industry stocks at decade-low of 2,758 mb, 88 mb below y-o-y
Key Themes: - Volatility collapsed to near all-time lows - Jet fuel demand at all-time highs in US and Europe (summer travel) - US gasoline driving season below par (-2% y-o-y in May-Jul) - Europe demand surprisingly resilient: now expecting +10 kb/d (vs -100 kb/d at start of year) - EU ban on products refined from Russian crude starting Jan 2026 - New US sanctions on Iran (most significant since 2018) - Venezuela restrictions eased -- Chevron gets new license - Japan at multi-decade demand lows (2.7 mb/d in May)
Revisions from Jul: Demand cut 20 kb/d; supply growth raised 400 kb/d
September 2025 -- "Pushed and pulled"¶
Date: 11 September 2025
Key Data: - Brent: ~$67/bbl (largely unchanged) - 2025 demand growth: revised UP to 740 kb/d - 2026 demand growth: ~700 kb/d - Global supply: record 106.9 mb/d (Aug) - 2025 supply growth: 2.7 mb/d to 105.8 mb/d; 2.1 mb/d in 2026 to 107.9 mb/d - Global stocks: rose 26.5 mb in Jul; cumulative +187 mb since Jan - OPEC+ started unwinding second tranche of cuts (137 kb/d in Oct) - OPEC+ actual output +1.5 mb/d since 1Q25 (vs 2.5 mb/d target -- overproducers limit gains)
Key Themes: - OPEC+ unwinding second tranche of supply cuts (1.65 mb/d since April 2023) - Saudi Arabia ramped up by ~1.5 mb/d since January - OECD demand surprisingly resilient through 3Q25 (+100 kb/d y-o-y) - Non-OECD demand growth "relatively muted" -- China essentially flat y-o-y in July - 310 kb/d cumulative downward revision to global demand since start of year (entirely non-OECD) - Gasoil and jet/kerosene strongest OECD products (macro-driven recovery) - Global jet/kerosene near 2019 levels in summer - Investor sentiment "strongly bearish" -- dwindling hopes for Russia-Ukraine peace - Forecast 2.5 mb/d stock builds in 2H25
October 2025 -- "Stocking up"¶
Date: 14 October 2025
Key Data: - Brent: ~$64/bbl (down ~$11 YTD) - 3Q25 demand growth: 750 kb/d (rebound from 2Q25's tariff-hit 420 kb/d) - 2025 demand growth: ~700 kb/d; 2026: ~700 kb/d - Global supply: 108 mb/d (Sep), up 5.6 mb/d y-o-y - 2025 supply growth: 3 mb/d to 106.1 mb/d; 2.4 mb/d in 2026 - Oil on water surged 102 mb in Sep (largest since Covid) - Global stocks: 7,909 mb (Aug, 4-year high) - Cumulative surplus since Jan: 1.9 mb/d - Volatility at historical lows
Key Themes: - DEEP DIVE: Oil balance decomposition (crude vs NGLs vs products) explaining price resilience - NGL surplus dominated overhang Apr-Aug (no crude price impact) - China absorbed crude surplus Apr-Aug (tightening market, supporting prices) - September: paradigm shift as crude surplus emerges from OPEC+ and non-OPEC+ surge - North Sea Dated now trading below Dubai M1 -- historic reversal (Dubai premium 46% of 2025 vs discount 74% of prior decade) - Atlantic Basin crude moving increasingly West-to-East - Russian refinery attacks cut processing by ~500 kb/d, boosting global diesel/jet cracks - Light sweet crude margins at 2-year highs in Europe - US port fees on Chinese-linked vessels reshaping shipping
November 2025 -- "Imbalances"¶
Date: 13 November 2025
Key Data: - North Sea Dated: ~$62/bbl (4th consecutive monthly decline) - 3Q25 demand growth revised UP to 920 kb/d (from 750 in Oct report) - 2025 demand growth: 790 kb/d; 2026: 770 kb/d (both revised up) - Global supply: 108.2 mb/d (Oct, -440 kb/d m-o-m); up 6.2 mb/d since January - 2025 supply growth: 3.1 mb/d; 2026: 2.5 mb/d to 108.7 mb/d - Observed stocks surged 77.7 mb in Sep (2.6 mb/d) -- highest since Jul 2021 - Oil on water up 80 mb in Sep, further 92 mb in Oct - Cumulative stock build Jan-Sep: 313 mb (1.15 mb/d) - Russian Urals plunged to $43.52/bbl; exports to $11B/month (lowest since invasion)
Key Themes: - US/UK sanctioned Rosneft and Lukoil (together ~50% of Russian crude production) - Russian exports fell 420 kb/d in Nov; sanctioned barrels = 32% of crude on water rise - Chinese demand revised up significantly in 3Q25 (+280 kb/d y-o-y, after -180 in 2Q25) - LPG/ethane flipped from -30 kb/d (2Q25) to +290 kb/d (3Q25) -- tariff-driven volatility - US government shutdown adding uncertainty - Refining margins at 2-year highs (Europe/Asia) on product tightness + Russian refinery disruptions - Middle distillate markets "particularly tight" with limited relief potential - Petrochemical feedstock growth only 260 kb/d vs much higher expectations - US, China, Nigeria each contributing ~120 kb/d of demand growth
Revisions from Oct: 3Q25 demand revised up 170 kb/d; 2025 annual up ~90 kb/d; 2026 up ~70 kb/d
December 2025 -- "Parallel markets"¶
Date: 11 December 2025
Key Data: - North Sea Dated: ~$63/bbl (5th consecutive monthly decline; longest losing streak in 11 years) - WTI: ~$59/bbl - 2025 demand growth: 830 kb/d (revised up again) - 2026 demand growth: 860 kb/d (revised up 90 kb/d -- improved macro/trade outlook) - Global supply: fell 610 kb/d in Nov (from Sep record of 109 mb/d; down 1.5 mb/d) - 2025 supply growth: 3 mb/d; 2026: 2.4 mb/d to 108.6 mb/d - Global observed stocks: 8,030 mb (Oct, 4-year high); builds averaged 1.2 mb/d over 10 months - Cumulative builds Jan-Nov: 424 mb - Oil on water up 213 mb since Aug - Russian Urals at $43.52/bbl; revenues at post-invasion lows
Key Themes: - "Parallel markets" -- crude/NGL surplus vs product tightness persist simultaneously - Refining margins at 3-year highs (Nov) despite crude surplus - EU ban on products refined from Russian crude effective Jan 2026 - Russian oil exports fell ~400 kb/d in Nov to 6.9 mb/d; revenues $11B (-$3.6B y-o-y) - Iran loading ~1.9 mb/d despite sanctions, but Chinese buyers pausing (exhausted import quotas) - Iranian oil on water surged 40 mb since Aug - Unplanned refinery outages (Kuwait, Kazakhstan) + sanctions on Russia cut global supply - Middle distillate tightness expected to persist through 2026 - Chinese crude stocks built 58 mb Jan-Nov under new Energy Law storage obligations - US gas liquids stocks up 63 mb Jan-Nov - Gasoil and jet/kerosene = 50% of 2025 demand growth - 2026: petrochemical feedstocks to dominate growth (>60% share, up from 40% in 2025)
Revisions from Nov: 2025 demand up 40 kb/d; 2026 demand up 90 kb/d; supply down 100 kb/d
March 2026 -- "Dire Straits"¶
Date: 12 March 2026
Key Data: - Brent: spiked near $120/bbl, settled ~$92/bbl (+$20/bbl in month) - 2026 demand growth: CUT to 640 kb/d (down 210 kb/d from Feb report) - Global supply: projected to PLUNGE 8 mb/d in March - Middle East production curtailed by at least 10 mb/d (crude + 2 mb/d condensates/NGLs) - ~20 mb/d of crude and product flows through Strait of Hormuz disrupted - 3.3 mb/d of refined product exports + 1.5 mb/d of LPG exports from Gulf disrupted - 4+ mb/d of refining capacity shut or at risk in region - Global stocks at 8,210 mb (Jan) -- highest since Feb 2021 - IEA emergency stock release: 400 mb agreed on 11 March
Key Themes: - WAR IN THE MIDDLE EAST: US and Israel launched joint air strikes on Iran (28 Feb) - "Largest supply disruption in the history of the global oil market" - Strait of Hormuz shipping reduced "to a trickle" -- near-total closure - Producers shutting in production as storage fills (Iraq, Qatar, Kuwait, UAE, Saudi Arabia) - Saudi Arabia can reroute via East-West Pipeline to Yanbu (up to 5 mb/d capacity) + UAE via Fujairah (0.5-0.7 mb/d) - Aramco strategic storage: Japan (11.2 mb), Korea (5.3 mb), China/Zhoushan (6 mb), Rotterdam, Sumed - India most exposed (40% of crude from Gulf, limited strategic reserves of 39.1 mb) - China holds 120 days of net seaborne crude imports in commercial + strategic stocks - Jet fuel demand cut 40% in Middle East (Mar-Apr); LPG demand growth cut 170 kb/d - LPG crisis for Indian domestic cooking/heating (45% of Gulf LPG exports go to India) - East Africa clean cooking transition at risk - Russian crude sanctions temporarily suspended for Indian buyers (30 days, OFAC waiver) -- access to ~30 mb on water - VLCC rates at 6x five-year average - Historic IEA emergency stock release (400 mb) -- largest ever coordinated response
Macro Narrative Arc¶
Phase 1: Cautious Optimism (Jan-Feb 2025)¶
The year opened with prices above $80/bbl, tightened by new sanctions on Russia/Iran and cold weather. Demand growth was expected at ~1 mb/d, with robust US ethane and diversifying non-OECD sources replacing China's diminished role. The IEA flagged that "2024 marks the beginning of a period of slower and more fragmented global oil demand growth."
Phase 2: Tariff Shock (Mar-May 2025)¶
The escalation of US trade tariffs triggered the largest demand downgrade since the pandemic. GDP assumptions were slashed from 3.1% to 2.4%. Brent crashed from $70 to below $60/bbl. The Baker Bloom Davis Trade Policy Uncertainty Index hit 40-year highs. Simultaneously, OPEC+ surprised with aggressive production increases (411 kb/d/month) while US shale producers cut capex by up to 9%.
Phase 3: Fragile Equilibrium with Geopolitical Shocks (Jun-Aug 2025)¶
Israel's June 13 air strikes on Iran temporarily spiked prices to $80/bbl before a ceasefire restored calm. The US-China tariff detente improved sentiment. OPEC+ fully unwound the first tranche of voluntary cuts by September. Demand growth remained weak (~680-740 kb/d), with emerging markets underperforming. A massive disconnect emerged between the surplus in balances and resilient prices, explained by Chinese crude stockpiling and US NGL inventory builds absorbing the overhang.
Phase 4: The Great Surplus (Sep-Dec 2025)¶
Supply surged to record highs (109 mb/d in Sep). Global stocks built by 313+ mb through nine months. Oil on water exploded (+213 mb from Aug), with sanctioned barrels and long-haul Atlantic-to-Asia routes driving volumes. Yet prices held in the $60-70/bbl range as crude builds concentrated in China and on water, not in key pricing hubs. A historic reversal saw Dubai crude trade at a premium to North Sea Dated. Product markets remained paradoxically tight (refining margins at 3-year highs) as Russian refinery attacks and limited spare capacity constrained output.
Phase 5: Strait of Hormuz Crisis (Feb-Mar 2026)¶
The US-Israeli joint strikes on Iran on 28 February 2026 triggered the "largest supply disruption in the history of the global oil market." The near-closure of the Strait of Hormuz cut ~20 mb/d of flows, forcing Gulf producers to shut in at least 10 mb/d. Brent spiked near $120/bbl. The IEA authorized an unprecedented 400 mb emergency stock release. The crisis exposed the vulnerability of global supply chains to LPG (India cooking fuel), jet fuel, and middle distillate disruptions. The human and economic consequences extended far beyond oil markets.
Key Structural Themes Across All Reports¶
1. The End of Chinese Demand Dominance¶
China's share of global oil demand growth collapsed from 60% (2013-2023 average) to ~15-20% in 2025. Fuel demand plateaued; growth was entirely petrochemical feedstocks. Gasoline demand declined 3-5% annually on EV penetration. This represented the single most important structural shift in oil markets.
2. The Petrochemical Feedstock Pivot¶
LPG, ethane, and naphtha became the dominant source of oil demand growth, accounting for 33-70% of annual gains depending on the quarter. The US ethane boom (driven by Permian NGL production and new cracker capacity) was the primary engine, but tariff disruptions caused wild swings.
3. OPEC+ Discipline Collapse¶
The producer alliance moved from carefully managing supply to aggressively unwinding 2.2 mb/d of voluntary cuts in just 5 months (Apr-Sep 2025), then began a second tranche. Persistent overproduction by Kazakhstan, Iraq, UAE, and others undermined coordination. Saudi Arabia bore the brunt of actual increases, ramping up 1.5 mb/d.
4. The Sanctions Treadmill¶
Russia, Iran, and Venezuela were under overlapping and intensifying sanctions throughout the period. The Rosneft/Lukoil sanctions (Nov 2025) and EU product import ban (Jan 2026) were the most impactful. Iranian/Russian crude piled up on water. Russian revenues collapsed to post-invasion lows.
5. The Two-Speed Market¶
A persistent disconnect emerged between crude/NGL surplus (concentrated in China stocks, US gas liquids, and oil on water) and tight refined product markets (limited spare refining capacity, Russian refinery disruptions). This "parallel markets" dynamic defied conventional analysis.
6. Atlantic-to-Asia Trade Flow Reversal¶
Growing Atlantic Basin supply (US, Brazil, Guyana, Canada) exceeded regional refining needs, flipping the crude flow direction and reversing the historic Dubai discount to North Sea Dated. This structural shift has implications for long-term crude pricing.
7. OECD Structural Decline¶
OECD oil demand was in structural decline throughout 2025 (-30 to -70 kb/d), driven by Japan's multi-decade lows, EV penetration, and improving efficiency. The only bright spot was periodic cold weather boosting heating demand.