The International Energy Agency has warned oil stockpiles are rapidly depleting, increasing the urgency around reopening the strait of Hormuz.
The IEA explained in a new report that observed stocks had fallen below 7.9 billion barrels for the first time since April 2025:
double quotation markAlthough the market is projected to return to surplus towards the end of this year, risks remain substantial and the urgency of reopening the Strait has increased, as previously available inventory buffers are rapidly depleting.
The report, released this morning, was updating the market after benchmark crude prices surged to 2-month highs in July, following the breakdown of the Iran-US ceasefire agreement, which reversed the recovery in oil supplies from the Gulf.
It left oil trading in an “unusually wide range”, swinging from around $105 to $70 through the month, “driven by sudden diplomatic pivots on the conflict”, the IEA said.
The global energy watchdog has now slashed its global supply forecasts:
double quotation markWith an agreement enabling the reopening of Hormuz and unhindered transit through the Bab el-Mandeb Strait still elusive, we have again lowered supply estimates for the rest of the year.
Global oil supply is now forecast to fall by 4.3 mb/d in 2026, to 102 mb/d, as growth of 1.4 mb/d from the Americas only partly offsets losses in the Middle East and Russia.