Opec lowered its forecast for world oil demand in the second quarter by 500,000 barrels per day, the producer group's monthly oil report showed in its first public assessment of the Iran war's impact on the market.
Opec sees a smaller
hit to oil demand from the war this year than some other forecasters, such as
the US government's Energy
Information Administration, reported Reuters.
Opec also made no
change to its full-year outlook as it sees consumption rebounding in later
months.
The war has
effectively closed the Strait of Hormuz, the world’s most important oil route,
shutting in millions of barrels of Middle East production and sending fuel
prices soaring. The price surge is pressuring consumers and businesses across
the globe, and triggering government action to conserve supplies.
Global oil demand is
projected to average 105.07 million bpd in the second quarter, Opec's report
said, down from the 105.57 million bpd forecast in last month's report.
"The demand
growth for the second quarter of 2026 is revised down for both the OECD and
non-OECD, driven mainly by slight transitory weakness in oil demand
growth, given ongoing developments in the Middle East," Opec said,
referring to countries inside or outside the Organisation for Economic
Co-operation and Development grouping of industrialised nations.
Opec+ OIL OUTPUT
PLUNGES IN MARCH
Opec kept unchanged
its forecast that world oil demand will rise by 1.38 million bpd in 2026, in
contrast to the EIA which halved its prediction in an April 7
report.
Opec+, which includes
the Organisation of the Petroleum Exporting Countries plus other producers such
as Russia, had agreed to resume oil production hikes as of April, although the
report highlighted how steeply output has fallen since the Iran conflict began at
the end of February.
Crude oil output by Opec+
averaged 35.06 million bpd in March, down 7.70 million bpd from February,
citing secondary sources, the report showed, with Iraq and Saudi Arabia making
the biggest cuts.
Opec+ agreed on April 5 to raise its oil output quotas by 206,000 bpd for May, a modest rise that will largely exist on paper as long as key members are unable to raise production due to the effective Hormuz blockage.
