OPEC cuts its 2026 oil demand growth forecast and raises its 2027 outlook OPEC's secretary general says expected global oil demand growth for 2026 is now only a fraction of the January forecast, while the 2027 growth outlook has been raised.

The secretary general of the Organization of the Petroleum Exporting Countries (OPEC), Haitham Al Ghais, said on Monday, October 12, in Dubai that the organization had cut its 2026 global oil demand growth forecast to a fraction of its start-of-year value. His remarks repeat the figures from OPEC's latest monthly report, already published, and do not constitute a new revision. The next report is due in the coming days and may change the forecasts for both 2026 and 2027. The organization is at the same time shifting the "lost" growth to 2027, on the basis of pent-up demand.

The Gulf war at the heart of the revisions The primary cause of these revisions is the war launched by the United States and Israel against Iran, followed by the de facto closure of the Strait of Hormuz. According to the International Energy Agency (IEA), shut-in Gulf production remains massive, global supply has fallen again and Saudi Arabia's crude production collapsed month on month. Production shut-ins are not unprecedented in the market: Gulf producers shut in nearly three quarters of offshore oil output during a recent episode. On the Iranian side, Tehran named the head of NIOC acting oil minister.

The press reports that the Saudi East-West pipeline, which bypasses Hormuz via the Red Sea, was hit by drones and temporarily shut. Regional negotiations on reopening the strait were also postponed. According to the IEA, the market is balancing only through a drawdown of global stocks that has had no recent precedent.

A forecast trimmed at every report since spring The 2026 growth forecast first stayed unchanged for many months, extending the very first estimate made by the OPEC Secretariat for the year. It was then cut at each monthly report since spring, losing most of its initial value. Conversely, the 2027 forecast was raised at each of these reports: expected growth next year is now a multiple of that expected this year.

According to press accounts of the latest report, OPEC justifies the cut by the economic effect of geopolitical tensions, renewed inflation and uncertainty over US trade policy. It attributes the expected increase in 2027 first to transport fuels, then to petrochemical feedstocks, notably in China. This reading assumes that consumption is not destroyed but deferred.

Crude prices and divergence with the IEA Crude prices have seen sudden spikes interspersed with pullbacks in response to diplomatic announcements. The physical price of dated Brent peaked in early autumn, and the Brent futures contract was trading well above its pre-war level. According to the IEA, tension is even more acute in refined products, led by diesel, which weighs directly on consumption.

For the current year, OPEC and the IEA diverge radically: OPEC maintains modest demand growth. The United Arab Emirates, which left OPEC and OPEC+, is no longer among the organization's members, whose voluntary adjustments subgroup comprises Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria and Oman.