The OPEC member country’s oil production fell further in April, down more than 30% since the start of the Iran war in late February, the cartel said in its latest monthly update on Wednesday.
OPEC also revised down its forecast for demand growth in 2026 to about 1.2 million barrels per day, from the previous estimate of about 1.4 million barrels per day. Global demand faces constraints after Iran’s blockade of the Strait of Hormuz effectively cut off supplies from the Persian Gulf.
OPEC production fell by 1.7 million barrels per day in April, after falling by 7.9 million barrels per day in March. In total, OPEC countries’ production fell by more than 30%, or more than 9.7 million barrels per day, during the war.
The update released by OPEC on Wednesday is likely to be the last to include data from the United Arab Emirates, which left the cartel on May 1.
More than 14 million barrels a day have been halted as a result of the Hormuz shutdown, with total supply losses from Gulf oil producers now exceeding 1 billion barrels, according to an International Energy Agency update released Wednesday.
Gulf oil production during the Iran war
Source: OPEC production, thousands of barrels per day
In contrast to OPEC’s optimistic outlook, the IEA expects oil demand to fall by 420,000 barrels per day in 2026. The IEA, headquartered in Paris, is a group of primarily Western countries that work together to ensure energy security.
According to the IEA, the actual gap between supply and demand is much smaller because there is a surplus of oil on the market heading into 2026. Producers and consumers are also taking action to mitigate losses, the group said.
Saudi Arabia and the UAE have diverted some exports to ports that bypass Hormuz, the IEA said. Producing countries outside the Middle East, particularly the United States, responded to the crisis by surging exports to record levels.
Government and commercial stockpiles also helped reduce losses, the IEA said. However, oil inventories are falling at a record pace due to increasing supply losses due to the Hormuz shutdown. Inventories fell by 250 million barrels (4 million barrels per day) in March and April, the IEA said.
The IEA said the oil market is likely to see more price volatility as the summer peak demand period approaches.
