IEA's latest monthly report: Sanctions impact supply, demand prospects improve, crude oil surplus pressure is expected to ease in 2026

The Zhitong Finance App learned that in the latest monthly crude oil market report released on Thursday, the International Energy Agency (IEA) raised the 2026 global crude oil demand growth forecast and lowered the supply growth forecast. It is expected that the market surplus will narrow slightly next year.

The Paris-based agency predicts that the global crude oil oversupply will be 3.84 million barrels per day in 2026, while the estimated value given in its November report is 4.09 million barrels per day.

Based on the improved macroeconomic outlook and “tariff-related concerns have basically subsided,” the IEA simultaneously raised the global crude oil demand growth forecast for this year and next two years.

The agency pointed out that due to the impact of sanctions against Russia and Venezuela on exports, the increase in global crude oil supply in 2025-2026 will be slightly lower than previously anticipated.

At the same time, the IEA believes that in the context of limited idle refining capacity outside of China and the EU imposing a new round of sanctions on Russian crude oil derivative fuel exports, the “parallel market” trend where sufficient crude oil supply coexists closely with the refined oil product market will continue for some time.

Demand prospects are improving

The IEA raised the 2026 oil demand growth forecast by 90,000 barrels per day to 860,000 barrels per day; at the same time, it raised the 2025 demand growth forecast by 40,000 barrels per day to 830,000 barrels per day.

The agency said, “The current oil price and the US dollar exchange rate are both approaching four-year lows, which will provide further support for the growth of crude oil demand next year.” The report also mentioned that almost all of the increase in crude oil demand in 2025 comes from non-OECD countries, and the energy demand in such countries is more sensitive to macroeconomic fundamentals.

The IEA pointed out that tariff disputes had dragged down crude oil consumption before, and the US recently reached a series of trade agreements to push market economic sentiment back on track.

Sanctions impact supply side

The IEA expects global oil supply to increase by 2.4 million barrels per day next year, and previously predicted an increase of 2.5 million barrels per day.

Affected by sanctions disturbances, the agency simultaneously lowered OPEC+ crude oil production forecasts for 2025 and 2026.

The report shows that due to declining production in sanctioned Russia and Venezuela, global crude oil supply fell by 610,000 barrels per day in November.

The IEA mentioned that Russian crude oil export revenue fell to its lowest level in November since the Russian-Ukrainian conflict fully broke out in 2022.

On the other hand, due to rising crude oil production in the American region (the United States, Canada, Brazil, Guyana and Argentina), the IEA maintained the supply forecast for non-OPEC+ oil producers this year and next two years unchanged.