According to the IEA, when is global oil demand now expected to recover, and what key factors are delaying that recovery?

The IEA states that global oil demand recovery is now delayed to 2027, with demand projected to rise by 2.6 million barrels/day that year, narrowly offsetting losses in 2026. This delay is driven primarily by supply pressures from the Middle East—including heightened security risks reducing Gulf capacity by more than 10 million barrels/day—and the ongoing US-Iran conflict, which has left the two countries 'at an impasse amid renewed hostilities'. Additional contributing factors include the protracted Russia-Ukraine war (now in its fifth year), attacks on Saudi infrastructure, disruptions to tanker traffic through the Strait of Hormuz and Bab el-Mandeb Strait, and intensified Ukrainian strikes on Russia’s refining system that have nearly halted Russian product exports.

What does the IEA report say about diesel/gasoil market tightness, and how severe are the price increases compared to pre-war levels?

The IEA highlights that market tightness is 'now most acute' for refined products—especially diesel/gasoil, which accounts for nearly 30% of global demand—with U.S. diesel prices surpassing $200/barrel in early September, representing a 94% increase over pre-war levels; Europe and Asia saw similarly sharp rises. Diesel exports from the Gulf fell to 390,000 barrels/day—just under a quarter of pre-war volumes—due to constrained trade flows through the Strait of Hormuz, while combined net diesel/gasoil exports from the Gulf and Russia dropped 1.6 million barrels/day between February and August, a decline that reflects both regional supply disruptions and the near-halt of Russian product exports following Ukrainian attacks.

Global oil demand recovery delayed to 2027 amid US-Iran conflict and rising crude prices – IEA

Sep 11, 2026

The IEA projects global oil demand recovery to 2027 due to Middle East conflicts inflating crude prices and reducing supply. Brent futures exceeded $105/barrel while diesel prices surged nearly 94% above pre-war levels.

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