Washington, DC – The International Energy Agency (IEA) has sharply lowered its 2026 global oil demand forecast once again. This comes as the vital Strait of Hormuz remains closed and supplies remain severely constrained. Reuters reports that the new forecast projects a decline in demand of 1.6 million barrels per day (bpd). This exceeds the 1 million bpd drop predicted in the previous monthly report for July. The dramatic price surge has deterred buyers and reduced global consumption.
Crude oil prices have remained significantly higher than levels seen before the US and Israeli attacks on Iran in late February. This military conflict has been devastating. It has caused extensive damage to the oil infrastructure of several vital Gulf states.
Maritime navigation paralyzed and the number of transiting ships dropped to a record low.
Meanwhile, the latest shipping data shows that the number of vessels observed in the Strait of Hormuz has plummeted to a new record low, with only eight ships detected on Tuesday. This sharp decline is attributed to ship owners and shipping companies avoiding the strategic waterway. This comes amidst ongoing and escalating hostilities in the Middle East, according to Reuters.
Data from logistics analytics firm Kpler revealed that Tuesday’s total of eight ships was a significant drop from the ten-day daily average of approximately 12. This marks the lowest daily figure since August 5th. The data also showed that only one ship, a coal carrier, managed to exit the strait. The remaining vessels proceeded cautiously. However, they were unable to complete their transit.
The political solution is deadlocked and the Iranian blockade continues.
These economic crises coincide with the announcement by the United States and the Houthi group in Yemen of separate military attacks. This comes at a time when the prospects for ending the war with Iran are significantly diminishing. Tehran has made it unequivocally clear that the Strait of Hormuz will remain closed to international shipping. It will not return to normal unless Washington agrees to and accepts its political and military conditions. Thus, global energy markets remain hostage to a state of ongoing instability and tension.
