Global oil demand will fall by one million barrels a day in 2026, the IEA said on Friday, making it the first annual contraction since 2020, when Covid lockdowns grounded aviation and shuttered industry.
The comparison flatters this year's decline in one respect, since demand collapsed by around eight million barrels a day at the height of the pandemic, but it underlines how severely the closure of the Strait of Hormuz has damaged the global economy.
The contraction is "highly skewed in both product and regional terms", the agency noted in its monthly report.
Earlier IEA analysis traced the sharpest losses to Asia's import-dependent economies and to petrochemical feedstocks such as naphtha and liquefied petroleum gas, whose supply chains run through the Strait of Hormuz.
At the time of writing, the front month contract on Brent crude, the international benchmark, was trading at around $76 a barrel, roughly 6% higher than before the US and Israel launched strikes on Iran in late February, and far below the peaks near $120 reached in March at the height of the conflict.
