Oil Slumps 3% as Demand Downgrade Revives Surplus Fears

Oil prices tumbled on Thursday after a downward revision to global demand growth projections reignited concerns that supply could once again outpace consumption later this year.

Brent crude slid nearly 3% to trade around $67 per barrel in afternoon dealings, while U.S. West Texas Intermediate (WTI) retreated into the low $62 range. The decline gathered momentum after the International Energy Agency (IEA) reduced its 2026 global oil demand growth forecast to 850,000 barrels per day, down from 930,000 barrels per day projected just a month earlier.

Latest Oil Prices: 

WTI Crude • 62.80 -0.04 -0.06%

Brent Crude • 67.47 -0.05 -0.07%

Murban Crude • 68.07 -1.53 -2.20%

Louisiana Light • 3 days 65.40 -0.54 -0.82%

Bonny Light • 78.62 -2.30 -2.84%

Mars US • 69.79 -0.88 -1.25%

Gasoline • 1.912 -0.004 -0.19%

Natural Gas • 3.221 +0.004 +0.12%

While the adjustment may appear modest in isolation, the broader market context amplified its impact. The IEA continues to anticipate global supply growth of roughly 2.4 million barrels per day this year, a figure that significantly exceeds the revised demand outlook. The implied imbalance has sharpened investor sensitivity to the risk of inventory builds, particularly as seasonal disruptions fade.

Earlier this year, harsh winter storms temporarily tightened supply, shutting in more than 1 million barrels per day in North America alone. Additional outages in Kazakhstan, Russia, and Venezuela contributed to a combined global supply decline of about 1.2 million barrels per day in January. However, those lost volumes are steadily returning to the market, shifting focus back to underlying fundamentals.

The divergence between major forecasting bodies has also deepened market uncertainty. While OPEC maintains a more optimistic view, projecting demand growth above 1.4 million barrels per day, Thursday’s price action suggests traders are currently leaning toward the more conservative outlook.