The conflict in the Middle East has triggered an unprecedented disruption to global fuel markets, tightening supply and placing significant pressure on consumers and economies worldwide. In response, the IEA has launched its largest ever release of emergency oil stocks and also published a menu of demand-side measures that governments, businesses and households can take to shelter consumers from oil price pressures and support energy security.
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Oil demand set to decline the sharpest since Covid cuts
Oil demand is expected to contract by 80 kb/d this year, as the Iran war upends the International Energy Agency's (IEA's) global outlook. This is 730 kb/d less than in last month’s report and a forecast 1.5 mb/d 2Q26 decline would be the sharpest since Covid-19 slashed fuel consumption. Initially, the deepest cuts in oil use have come in the Middle East and Asia Pacific, mainly for naphtha, LPG and jet fuel. However, demand destruction will spread as scarcity and higher prices persist.