BAKU, Azerbaijan, October 30. The projected global oil supply deficit for 2026 has been revised downward by 310,000 barrels per day (bpd), to 3.5 million bpd.
This was stated in the Oxford Institute for Energy Studies (OIES) Oil Monthly report.
The report indicated that the forecast for a supply surplus in 2027 remains largely unchanged at about 900,000 bpd.
According to the report, about 60% of the reduction in the projected deficit for 2026 is due to increased supply, primarily driven by a stronger-than-expected recovery in supplies from the Middle East in Q3 2026.
"The forecast for global oil supply has been raised by 830,000 barrels per day for Q3 and by 220,000 barrels per day for Q4 2026. The annual supply estimate has been increased by 190,000 barrels per day.
An additional factor behind the revision was a downward revision of the demand forecast by 120,000 barrels per day, primarily in the second half of the year, amid uncertainty regarding government policy, limited supply of petroleum products, and high prices,” the institute’s report said.
At the same time, the OIES still expects the deficit to widen from 2.5 million bpd in Q3 to 4.5 million bpd in Q4 2026.
“This is due to the fact that the recovery in supply, which remains limited, is lagging behind the projected increase in demand. At the same time, the expected deficit in the fourth quarter is 430,000 barrels per day less than the previous estimate.
In 2027, the supply surplus will be concentrated almost entirely in the second half of the year. The market balance in the first half of the year will be 160,000 barrels per day tighter than previously estimated.
A deficit of 1.5 million barrels per day in Q1 2027 will largely offset a surplus of 1.55 million barrels per day in Q2. As a result, the market will be broadly balanced in the first half of the year.
In the second half of the year, the average surplus is expected to be 1.7 million barrels per day, which will allow for the replenishment of stocks.
However, the projected net increase in stocks in 2027 will offset only about 25% of the expected decline in stocks in 2026.
To restore OECD countries’ government crude oil stocks to their pre-war level, that is, approximately 90 days of consumption, by the end of 2027, they will need to be built up by an average of 685,000 barrels per day. This will account for about 80% of the projected surplus,” the institute reported.
According to OIES data, by August, the decline in global oil reserves since the end of 2025 had reached 501 million barrels, exceeding the total increase of 451 million barrels accumulated throughout 2025.
