Doha: The International Energy Agency (IEA) said the global oil market will see a larger surplus in 2026, reaching 4.09 million barrels per day (bpd), equivalent to about four percent of global demand. This comes amid increased production from the OPEC+ alliance and its competitors, coupled with slowing demand growth.

According to Qatar News Agency, in its monthly report released Thursday, the IEA stated that global oil supply growth will increase by approximately 3.1 million bpd in 2025 and 2.5 million bpd next year, an increase of about 100,000 bpd for each year compared to the previous monthly report.

The IEA estimates that supply will increase faster than demand, even after raising its forecasts today. It anticipates oil demand to rise by 770,000 bpd next year, an increase of 70,000 bpd from last month’s forecast, due to the high demand from petrochemical plants.

The IEA added that global oil production was 6.2 million barrels per day higher in October than at the beginning of the year.

Regarding Russian oil exports, the IEA stated that they have continued uninterrupted despite new US sanctions on Rosneft and Lukoil, which may have the most far-reaching impact yet on global oil markets.

The IEA’s updated forecasts indicate that the oil market is gradually moving towards a phase of increasing surplus, with supply growth outpacing demand growth.

This weak demand reflects a combination of factors, most notably the gradual shift towards cleaner energy, the adoption of energy efficiency policies by many countries, and the industrial slowdown in China, which has historically been the biggest driver of global demand growth.