Global oil supply shortfall can deepen further: IEA

The International Energy Agency (IEA) predicts a further decline in global oil supply this year, with a shortfall of 4.3 million barrels per day, or 4%, due to ongoing conflicts and disruptions in key shipping lanes. The group's latest report reveals that Middle East oil shipments have fallen to 12 million barrels per day, 8.3 million bpd below pre-war levels.

This is the lowest forecast for the year, putting global supply 1.27 million bpd below demand, widening the deficit from the 860,000 bpd gap forecast in July. The IEA expects the oil market deficit to reach 1.8 million bpd from July to September, a significant increase from its earlier July forecast. For 2027, the agency anticipates global supply to exceed demand by 4.61 million bpd, assuming a reduction in tensions.

Currently, global demand is expected to contract by 1.6 million bpd this year, a sharper decline than the 1 million bpd reduction seen previously. OPEC remains optimistic about demand growth, expecting an increase of 580,000 bpd, but this is 200,000 bpd lower than previous estimates.