IEA Marks Down Russian Oil Supply for 2026 and 2027 as Drone Strikes Hit Refineries
The agency trimmed its Russian production forecasts on damage to storage and refining, even as June crude output edged higher against a still-wide gap to quota.
The International Energy Agency lowered its forecast for Russian oil production in 2026 and 2027 in its monthly oil market report published on Thursday (2026-07-10), citing intensified Ukrainian drone attacks on Russia's storage, refining and transportation infrastructure.2
The revision reframes the supply side of a market that has spent months pricing OPEC+ barrels back into the balance. Russia produced an average of 9.2 million bpd of oil in 2025, but the agency now sees this year and next coming in below its earlier projections.2
The cuts are small in isolation. For 2026, the IEA trimmed its Russian oil supply forecast by 85,000 bpd to 8.9 million, and for 2027 it revised down by nearly twice that, 150,000 bpd, to 8.8 million.2
The direction is what counts. A second consecutive year of downgrades points to attrition rather than a one-off outage, with the agency tying the revision explicitly to continued strikes on refineries, storage facilities and transport links rather than to any OPEC+ quota decision.2
Yet the near-term physical data pulled the other way. Russia's crude production rose to 8.86 million bpd in June (2026-06) from 8.74 million bpd in May (2026-05) on the IEA's estimates of OPEC+ supply, a monthly gain of about 120,000 bpd.2
That gain still left a wide gap to Russia's paper commitment. June crude output ran 910,000 bpd below Russia's implied OPEC+ target of 9.76 million bpd, according to the agency's figures, a shortfall that suggests either capacity constraints or a deliberate choice to hold barrels back.2
For traders, the read is that Russia is producing more month-on-month while its forward ceiling is being marked down. The attacks degrade the assets that move and process crude, so the country can lift wellhead output and still struggle to convert it into exportable product. Front-month ICE Brent has held near $75, closer to the middle of its recent range than the highs the supply-risk headlines might imply.2
The wider OPEC+ backdrop complicates the picture. Seven members including Algeria, Iraq, Kazakhstan, Kuwait, Oman, Russia and Saudi Arabia agreed to raise their combined quota by 188,000 bpd in June, part of the group's move to unwind restraint after the United Arab Emirates left the alliance.1 Global oil production rose by 2.24 million bpd in 2025 to 74.85 million bpd, with OPEC+ accounting for 55.9% of output, according to OPEC's Annual Statistical Bulletin.1
So the group is adding supply to a market where one of its largest producers is being physically constrained. That partially offsets the bullish signal from the IEA's Russia cut, and helps explain why crude has held in the mid-$70s rather than breaking higher on the supply-risk headlines.1,2
The unresolved question is durability. If Ukrainian strikes keep degrading Russian refining faster than repairs restore it, the IEA's forward cuts will read as conservative, and the loss will surface in tighter export product rather than in headline crude. Watch the month-on-month Russian crude print against that 8.9 million bpd anchor for 2026, and whether June's recovery to 8.86 million holds or reverses into the second half.2