IEA: Global oil demand to decline in '26, a first since Covid

Global oil demand will decline this year for the first time since the 2020 pandemic as a price surge caused by West Asia conflict wipes out growth, the International Energy Agency (IEA) said.

"The Iran war has thoroughly upended the global outlook for oil consumption," the adviser to major economies said in its monthly report. "Demand destruction will spread as scarcity and higher prices persist."

Flows of crude oil and refined products through the Strait of Hormuz have been reduced to just 3.8 million barrels a day, compared with pre-crisis levels of about 20 million - or roughly 20% of world supplies, according to the agency.

Also Read: Trump deploys 10,000 troops, over 12 warships & more for Hormuz blockade; no ships cross in first 24 hours, says US Central Command

Global oil supply plunged by 10.1 million barrels a day last month, or about 9%, as Saudi Arabia, Iraq, the United Arab Emirates and Kuwait were forced to shutter production, the IEA said.

Oil's Disconnect
While oil futures registered an unprecedented surge in March, they remain considerably below record levels and the price of actual cargoes, trading at just under $100 a barrel in London. This "disconnect" between futures and physical markets is becoming "increasingly acute," according to the report.
Russian march earnings nearly double

Also Read: PM Modi speaks to Trump on importance of keeping Strait of Hormuz "open and secure"

Russia nearly doubled its earnings from oil exports in March as Moscow was granted sanctions relief in a bid to offset soaring energy prices, the IEA said on Tuesday.

The country earned $19 billion last month as crude and oil product exports rose to 7.1 million barrels per day (mb/d), an increase of 320 thousand barrels a day from February levels.