International Energy Agency reports global oil market instability

The International Energy Agency (IEA) reported that global oil stocks declined by 250 million barrels during March and April, representing a drop of 4 million barrels per day. The report, published in May, attributes this tightening to conflicts in the Middle East and the closure of the Strait of Hormuz. Output from Gulf countries affected by the strait's closure was 14.4 million barrels per day lower than pre-war production levels. Global supply dropped by an additional 1.8 million barrels in April to 95.1 million, bringing total daily losses since February to 12.8 million barrels. For 2026, the IEA projects global demand will contract to 104 million barrels per day, which is 1.3 million barrels less than original pre-war forecasts. Increased production in the Atlantic basin is currently providing partial supply relief. Assuming a gradual reopening of the Strait of Hormuz from June, the IEA estimates average global supply for 2026 will reach 102.2 million barrels per day, a decline of 3.9 million barrels daily.