PARIS (The Thursday Times) — The world oil market has tipped back into surplus for the first time since the war on Iran began, as Gulf exports recover faster than demand, the International Energy Agency says.
In its monthly oil market report, published on Friday, the Paris-based agency said global supply rose by 2.3 million barrels a day in October to 105.4 million, an increase of 5.3 million barrels a day since August.
Gulf oil exports, excluding Oman, reached 18.4 million barrels a day last month, still 26% below pre-war levels. Crude flows recovered to 15 million barrels a day, or 82% of their pre-war level.
Observed oil stocks rose by 52 million barrels in October, the first increase since June. Most of the build was oil on tankers at sea, which jumped by 86 million barrels to its highest level since January. Stocks on land kept falling and are at their lowest since at least 2016. Global inventories have fallen by 462 million barrels since the war began.
Prices fall, diesel stays dear
North Sea Dated crude fell by 32%, from a peak of $136 a barrel on 8 October to around $93, the agency said. That is still $22 above pre-war levels.
Diesel remains the tightest part of the market. European diesel prices fell by 11% over the same period but, at close to $180 a barrel, are still 77% above pre-war levels. Exports of refined products and LPG from the Gulf are running at roughly half their pre-war volume, and the cost of shipping crude from the Middle East to Asia is near record highs.
The IEA said attacks on Russian energy infrastructure are also cutting diesel supply, and that a faster release of IEA emergency diesel stocks over the coming months will help.
Demand to recover next year
The agency expects world oil demand to fall by 2.7 million barrels a day this year to 102.3 million, before growing again from around March and rising by 2 million barrels a day in 2027.
Supply is set to fall by 4.8 million barrels a day in 2026, then rebound by 6.6 million to 108.1 million barrels a day in 2027, including 5.3 million more from the Gulf. The IEA lowered its 2027 supply forecast because of constraints on Iranian shipments.
It expects the surplus to hold through the fourth quarter and grow in 2027, but warned that attacks on shipping “undermine maritime security, which is pivotal to a sustained recovery”. The GCC told the UN this week that Iran has fired more than 7,000 missiles and drones at them since the war began.
In Pakistan, petrol has been cut twice in two days, to Rs330 a litre from Saturday, while diesel stays at Rs360.
