The International Energy Agency expects world oil demand to fall by 2.6 million barrels a day in 2026, to 102.4 million barrels a day, as high prices and a weaker economic outlook weigh on consumption.
The outlook points to weaker consumption amid high fuel costs and economic pressure.
Lower demand does not automatically mean cheap fuel. Supply constraints and transport costs also shape prices.
Diesel availability, refinery activity and later IEA forecast revisions.
In its Oil Market Report published on 14 October, the IEA forecast that demand will be 2.5 million barrels a day lower in the fourth quarter than a year earlier, and 2.6 million barrels a day lower on average across 2026. Diesel accounts for about a quarter of the drop.
The agency links the decline to high prices, a deteriorating economic outlook in some countries and restricted availability of oil products following the conflict involving Iran.
Supply is falling even faster. The IEA expects global output to average 100.7 million barrels a day this year, 5.8 million less than in 2025, although supply recovered by 2.5 million barrels a day in September, to 102.3 million, led by Gulf producers.
Prices reflect the tight market. Brent futures had risen by about 13% since the start of September, to around $107 a barrel, and North Sea Dated crude averaged $116.89 a barrel in September. Observed global inventories were 509 million barrels below pre-war levels at the end of September, with stocks on land at their lowest since at least 2016.
Refinery runs are expected to fall by 2.3 million barrels a day this year, to 81.7 million, before rising by 2.8 million in 2027. For 2027 the IEA sees a partial recovery in demand of about 2 million barrels a day, which would still leave oil use 620,000 barrels a day — 0.6% — below 2025. It expects diesel markets to stay tight well into 2027.
Source: International Energy Agency, Oil Market Report, 14 October 2026. Forecasts may be revised in later IEA reports. Summary and wording by Megawise.
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