OPEC Cuts Its 2026 Oil Demand Growth Forecast to 0.8 Million Barrels a Day
OPEC trimmed its forecast for global oil demand growth this year to about 0.8 million barrels a day, down from around 1.0 million a month earlier, in its monthly report published on Monday, a downgrade that lands just as the group and its allies keep returning barrels to the market. The cut, concentrated in the second quarter, leaves OPEC expecting world consumption to average 105.9 million barrels a day in 2026.
The reduction of roughly 0.2 million barrels a day was the report’s main change. Almost all of this year’s growth comes from outside the industrialised world, with developing economies adding about 0.74 million barrels a day and the OECD barely 0.04 million, figures that together match the 0.78 million headline. OPEC still expects growth to reaccelerate to about 1.9 million barrels a day in 2027, though its absolute forecast for that year is little changed near 107.9 million, so much of the faster growth rate simply reflects the lower 2026 base. On the supply side, OPEC left its estimate for growth from producers outside the OPEC-plus alliance unchanged at about 0.6 million barrels a day for both years, led this year by the United States, Brazil, Canada and Argentina.
| Indicator | July MOMR | Change vs June |
|---|---|---|
| 2026 world oil demand growth | 0.8 mb/d | Cut about 0.2 |
| 2026 total world oil demand | 105.94 mb/d | – |
| 2027 world oil demand growth | 1.9 mb/d | – |
| 2027 total world oil demand | 107.88 mb/d | Little changed |
| Non-OECD demand growth, 2026 | 0.74 mb/d | – |
| OECD demand growth, 2026 | 0.04 mb/d | – |
| Non-alliance supply growth, 2026 and 2027 | 0.6 mb/d | Unchanged |
| Call on OPEC-plus crude, 2026 | About 42.3 mb/d | Minus 0.2, flat vs 2025 |
| OPEC-plus August production-target increase | 188,000 b/d | – |
The softer demand view sits awkwardly against the group’s own production decisions. On 5 July, the seven countries managing the alliance’s voluntary cuts, Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria and Oman, agreed to raise their production targets by a further 188,000 barrels a day in August, continuing the gradual unwinding of the reductions they first made in 2023. That is an increase in permitted output rather than a guaranteed rise in physical supply, since compensation for past overproduction and each country’s conformity can trim the realised addition. The group stressed a cautious approach and said it could pause or reverse the increases, with its next meeting set for 2 August. Adding barrels while trimming the demand outlook tilts the 2026 balance toward a looser market.
The report implies the world will need about 42.3 million barrels a day of crude from the OPEC-plus group this year, some 0.2 million less than OPEC estimated a month ago and almost unchanged from 2025, our calculation from its demand and non-alliance supply figures. That flat requirement is one of the report’s more telling signals: under OPEC’s revised assumptions, nearly all of this year’s demand growth is met by non-alliance supply and by the alliance’s own natural-gas liquids, leaving little extra room for its crude. For now a tight prompt market cushions the downgrade: OPEC’s preliminary April data put OECD commercial inventories about 53.7 million barrels below their five-year average, and the crude curve remains steeply backwardated, keeping near-term prices supported even as the longer-term picture softens.
Why it matters: For the Gulf, the report captures a delicate moment. Saudi Arabia, Kuwait and Iraq are among the seven lifting output as the 2023 cuts unwind, yet OPEC’s own demand math is weakening, a combination that raises the risk of softer prices into 2026 and, with it, pressure on oil-reliant budgets. Kuwait is one of the countries managing the gradual production return, and the group’s insistence that the increases can be paused or reversed is precisely a hedge against the demand signal in this report. How that balance resolves will shape Gulf revenue through the rest of the year.
Outlook: The immediate marker is the 2 August OPEC-plus meeting, where ministers will decide whether to keep restoring barrels or hold. Beyond that, the swing factors are the strength of demand outside the OECD, the pace of United States and other non-alliance supply, and the course of regional security around the Gulf, which continues to inject a risk premium into prompt prices. If demand keeps disappointing while output rises, the cushion of low inventories and a backwardated curve could thin.
Sources: OPEC.
