The Essentials:
- OPEC lowers its 2026 global oil demand growth forecast to 970,000 barrels per day.
- Expected growth for 2027 is revised upward to 1.73 million barrels per day.
- OPEC+ production declined in May, driven largely by falling output in Iran.

The Organization of the Petroleum Exporting Countries (OPEC) has trimmed its forecast for global oil demand growth in 2026 to 970,000 barrels per day, according to its monthly report released Thursday. This revision marks the second consecutive cut to its estimates. However, OPEC continues to anticipate a limited impact on consumption from the conflict in Iran, a stance that diverges from other bodies such as the US Energy Information Administration (EIA) and the International Energy Agency (IEA).

The cartel expects a rebound in consumption over the longer term, reflected in an upward revision for 2027 demand growth. That figure is now estimated at 1.73 million barrels per day, an increase of 190,000 barrels from the previous estimate. The closure of the Strait of Hormuz, a consequence of the war, has blocked the export of millions of barrels from the Middle East, leading to a surge in fuel prices.

OPEC+ crude production decreased in May, averaging 33.13 million barrels per day, a decline of 190,000 barrels per day compared to April. This drop is primarily attributed to Iran, where exports have plummeted under the weight of a US blockade. The report notes that the May figures include the United Arab Emirates, which departed OPEC and OPEC+ on May 1.

OPEC has emphasized that global economic performance remained resilient throughout H1 2026 despite geopolitical tensions, leaving its economic growth forecasts unchanged. Meanwhile, both the EIA and the IEA anticipate a decline in oil demand this year due to the ongoing conflict.

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