IEA Cuts Forecast Amid Easing Oil Supply Glut Concerns

The International Energy Agency has revised its forecast for the 2025 oil supply glut, noting increased demand prospects due to a stronger global economy. The agency cited lower supply from nations under sanctions. The global supply excess is trimmed, with oil trading at reduced prices.

The International Energy Agency (IEA) has made its first reduction in the forecast for next year's global oil surplus since May, citing stronger demand prospects driven by an improving world economy and reduced outputs from sanctioned nations.

The Paris-based agency's latest report notes that global oil production will still exceed demand by 3.84 million barrels per day, down from the previous 4.09 million, equating to nearly 4% of global consumption, a figure that aligns with the higher end of analysts' expectations.

This adjustment comes amid broader market dynamics with OPEC+ pausing output hikes for 2026's first quarter. Notably, the IEA sees a resurgence in demand growth linked to tariff anxiety alleviation, while concurrently anticipating supply dips due to ongoing sanctions impacting Russia and Venezuela.

(With inputs from agencies.)