IEA Predicts Significant Drop in Global Oil Demand

Apr 14, 2026

83 min

Apr 14, 2026 08:31

IEA: Global crude oil demand set for sharpest quarterly crash since Covid

## Global Oil Demand Decline

The International Energy Agency (IEA) forecasts a significant decline in global oil demand, marking the steepest quarterly drop since the Covid-19 pandemic. This downturn is attributed to economic slowdowns and policy changes impacting fuel consumption.

## Factors Influencing Demand

The IEA highlights that trade tensions and a sluggish economy are major factors contributing to reduced oil usage. Additionally, the Organization of the Petroleum Exporting Countries (OPEC+) reported a decrease in oil production by 7.9 million barrels per day in March, primarily due to disruptions in the Strait of Hormuz.

## Long-term Outlook

Despite the current decline, the IEA maintains that global oil demand will not collapse but will stabilize towards the end of the decade. This is due to the increasing adoption of electric vehicles (EVs), improvements in energy efficiency, and shifts in power generation methods.

## Regional Demand Trends

The IEA's report indicates that demand growth is now concentrated in non-OECD Asian countries, particularly India and China, while consumption in OECD countries continues to decrease. This trend mirrors the pandemic-era decline, although the current drivers are economic and policy-related rather than health-related.

## Impact of Electric Vehicles

The rise of EVs is expected to significantly reduce oil consumption. The IEA projects that EV sales could reach 17 million in 2024, with China leading the market. By 2030, EVs are anticipated to account for nearly half of all new car sales globally, further curbing oil demand.

## Market Reactions

In response to these developments, WTI crude futures fell below $96 per barrel. This drop follows reports of potential US-Iran negotiations aimed at extending a ceasefire, which could influence oil supply dynamics.

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