The world oil market will return to a surplus in the fourth quarter as Middle East exports recover faster than global oil demand, according to the International Energy Agency (IEA).
Q4 supply is forecast to average 105 million barrels per day, 1.7 million bpd above demand, reversing an earlier forecast of a deficit. Despite continued attacks on tankers, Gulf oil exports, excluding Oman, reached 18.4 mb/d in October, 26% below pre-war levels.
The recovery is driven by a surge from Saudi Arabia and Iraq, and the agency raised its 2026 global supply estimate by 920,000 barrels a day. Observed inventories rose by 52 million barrels in October 2026, the first increase since June, while North Sea Dated crude fell 32% from a high of USD 136/bbl in early October to USD 93/bbl.
However, Gulf exports of refined products and LPG remain at roughly half of pre-war levels. IEA members will make 71 million barrels of emergency stocks available by the end of February, including 15 million barrels of diesel.
Gulf Economist Staff Writer