Oil: Supply disruptions raise deficit risks – ING

ING analysts Warren Patterson and Ewa Manthey have highlighted growing concerns over potential deficit risks due to recent oil supply disruptions. Despite an easing in oil prices, with Brent crude remaining largely flat, tensions between the US and Iran remain unresolved, along with the resilience of Russia's port infrastructure.

According to EIA data, US crude inventories surged by 17.42 million barrels in the past week, the highest increase since January 2023. The combined total crude stocks rose by 11.31 million barrels when including the 6.12 million barrels of Strategic Petroleum Reserve (SPR) releases. The International Energy Agency (IEA) forecasts a 1.8 million barrels per day (b/d) deficit in the global oil market for Q3 2026, a figure that has increased since last month due to ongoing Middle East disruptions.

Meanwhile, global oil supply grew by 2.4 million b/d in July, but remains 6.3 million b/d lower compared to the previous year, with full-year supply now expected to decrease by 4.3 million b/d in 2026. The IEA has also revised downward its demand expectations, now projecting a 1.6 million b/d year-over-year decline in 2026 due to the GCC disruptions and elevated fuel prices.

OPEC maintains a more optimistic view on demand, projecting a 580,000 b/d yearly increase. However, this optimism seems premature given the current refined product prices.