Paris, July 10 (QNA) - The International Energy Agency (IEA) said it now expects global oil demand to decline by 1 million barrels per day in 2026, compared with its mid-June forecast of a 1.1 million-barrel-per-day decline.

In its monthly report released today, the agency said global oil supply averaged 98.8 million barrels per day in June and projected that it would average 102.6 million barrels per day in 2026, provided that the latest geopolitical tensions ease rapidly.

The IEA said global oil demand is recovering and now expects the decline in consumption during 2026 to be less severe than previously forecast after the market reached its lowest point in May. It added that global supplies have rebounded thanks to the partial resumption of shipping through the Strait of Hormuz following the ceasefire agreement signed on Jun. 17.

However, production remains about 9.4 million barrels per day below pre-war levels in the Middle East.

The agency also said global oil inventories rose in June for the first time since the outbreak of the Middle East conflict, increasing by 21 million barrels as volumes of oil in transit by sea climbed. By contrast, inventories in member countries of the Organisation for Economic Co-operation and Development fell by 62 million barrels during the same month.

Crude oil inventories outside OECD countries also declined by 37 million barrels, primarily because China drew down 41 million barrels from its onshore stockpiles while its imports remained at historically low levels. The agency added that refining margins reached their highest levels in four years in July, noting that increased crude oil supplies pushed oil prices lower even as refined product markets remained under pressure. (QNA)