OPEC Trims 2026 Demand Forecast for Third Month as August Output Decision Nears
Monday's monthly report cut demand growth to 780,000 bpd while Gulf production rebounds sharply, narrowing the bullish case for crude even before the August hike is confirmed.
OPEC cut its 2026 global oil demand growth forecast for the third consecutive month in its monthly oil market report released Monday (2026-07-13), trimming the estimate to 780,000 barrels per day, down 190,000 bpd from June's projection, even as the group prepares to approve another production increase for August.6
ICE Brent crude front-month fell 1.57% to $84.06 on Tuesday (2026-07-14) as the Gulf supply recovery combined with softening demand projections in OPEC's own models to press prices lower. WTI crude front-month was off 0.81% at $79.25.6
The supply rebound is substantial. OPEC+ June output climbed roughly 3 million bpd from May's disrupted level to average 36.28 million bpd as Gulf producers restarted volumes stranded during the Iran conflict, a pace of recovery that has exceeded many early estimates.6
The UAE, which departed OPEC during the Strait of Hormuz crisis and has since routed its exports through Fujairah, pumped a record 4.1 million bpd in June. Its exit from the group trimmed OPEC+'s effective quota base and contributed to the reduction of the planned June hike from 206,000 bpd to 188,000 bpd.6,5
For August, OPEC+ is expected to approve an increase of similar scale to June's. Yet the gap between announced quotas and physical output remains deep. OPEC+ averaged just 33.19 million bpd in April, against 42.77 million bpd in February before the Gulf disruption peaked.5
OPEC maintained that its demand outlook remains more bullish than rivals including the International Energy Agency. The group raised its 2027 demand growth estimate by 210,000 bpd to 1.94 million bpd, signaling confidence in medium-term consumption even as near-term estimates run lower for a third straight month.6
The United States is producing nearly 14 million bpd, a large non-OPEC supply base that limits how far any production restraint elsewhere can lift prices.6
The Strait of Hormuz, through which approximately 20 million bpd flowed in 2025 according to IEA data, remains a constraint. Analysts estimate Gulf producers have roughly 9.1 million bpd of capacity still effectively shut in, with a full restart requiring tanker redeployment, refinery repairs and wellhead work that cannot happen quickly. Morgan Stanley has forecast the market will lose a further billion barrels over 2026 before the supply recovery is complete.2,1,3
The three-month series of demand downgrades has narrowed OPEC's distance from more cautious forecasters. The group still projects stronger consumption growth than the IEA, but by a smaller margin than it did in April. A fourth consecutive cut in August would shift market interpretation of any production increase from active tightening to simply keeping pace with weaker demand.6
Kazakhstan adds texture to the internal OPEC+ debate over quota compliance. Energy Minister Yerlan Akkenzhenov said the country produced 19.7 million tons of oil and gas condensate in the first quarter of 2026, just 80.2% of year-earlier volumes, with exports totalling 15.3 million tons at 78.5% of the prior year — figures that show how broadly the Gulf disruption suppressed output across the alliance's membership.1
ICE Brent at $84.06 sits well below the $97.91 at which WTI July futures settled during the week of May 18 (2026-05-18), when traders were pricing maximum Hormuz risk. Most of that supply premium has unwound. The next pressure point is whether the August meeting delivers both a confirmed output hike and a fourth demand downgrade in the same month; that combination would test the group's ability to argue it is managing the market rather than chasing it.4,6