Oil struggles for direction as IEA flags volatility, OPEC cuts demand forecast
Ateela 2 Oil Tanker boat sails at sea on Qeshm Island in the Strait of Hormuz, Iran, on April 28, 2026.
Asgar Besharati | Getty Images
Oil was struggling to find direction Thursday as traders weigh in OPECThe demand outlook for this year is low, International Energy Agency It signaled more volatility ahead.
While the international benchmark Brent crude futures contract for July decreased by 0.21% to $105.42 per barrel, the US West Texas Intermediate futures contract decreased by 0.16% to $100.87 per barrel for June. Both had started the day with a marginal increase.
In its latest monthly update, OPEC lowered its demand growth forecasts for 2026 to around 1.2 million barrels per day from 1.4 million barrels per day previously. OPEC production fell by 1.7 million barrels per day in April and is down more than 30%, or 9.7 million barrels per day, since the start of the Iran war in late February.
OPEC’s latest update is expected to be the last to include data from the United Arab Emirates, which exited the cartel on May 1.
International Energy AgencyIn his speech on Wednesday, the impact of the Iran war on oil supply was also emphasized. “More than ten weeks after the start of the war in the Middle East, mounting supply losses in the Strait of Hormuz are depleting global oil stocks at a record pace,” the IEA said.
With supply disruptions of more than 14 million barrels per day, the total loss to Gulf producers is now over one billion barrels, the IEA said, adding that larger price fluctuations are likely as summer demand approaches its peak.
“The duration of rising fuel prices remains a matter of intense debate and is closely linked to ongoing geopolitical developments related to the closure of the Strait of Hormuz, as well as potential damage to oil and gas infrastructure in the Middle East due to further conflict,” ING analysts said in a note. he said.
US President Donald Trump’s meeting with Chinese President Xi Jinping will also be closely watched by investors.
Former U.S. Commerce Secretary Carlos Gutierrez told CNBC’s “Squawk Box Asia” on Wednesday that he wants the conflict to end because China is the largest customer of oil flowing through the Strait of Hormuz. “President Xi wants this war to end as much as President Trump.”
— CNBC’s Spencer Kimball contributed to this report.
Correction: This story has been updated to correct the day to Thursday.
