PARIS, Oct 14 (Bernama-Xinhua) -- Global diesel supply constraints are expected to persist into 2027 amid prolonged disruptions and escalating attacks on energy infrastructure in West Asia, the International Energy Agency (IEA) said on Wednesday, reported Xinhua.
In its October Oil Market Report, the IEA said global diesel exports fell by 700,000 barrels per day (kb/d) year on year in September, as prolonged supply disruptions led to counter-seasonal stock draws ahead of autumn refinery maintenance and peak winter demand.
Although global diesel prices have eased from record highs of more than US$200 per barrel in September, benchmark prices remain nearly twice as high as crude oil prices and almost double their pre-crisis levels.
The IEA warned that record diesel prices were already having widespread economic consequences, increasing the cost of goods and affecting real incomes, economic activity and inflation.
The agency said the gasoil market was expected to remain tight well into 2027, depending on the recovery of product supplies from West Asia.
Without such a recovery, further demand reductions might be needed to balance the market, potentially at a high economic cost, it added.
Global oil demand is forecast to fall by 2.5 million barrels per day (mb/d) year on year in the fourth quarter of 2026 and by an average of 2.6 mb/d for the full year.
A partial recovery of 2 mb/d in 2027 is expected to leave global oil consumption 620,000 barrels per day (kb/d), or 0.6 per cent, below 2025 levels, the IEA said.
Global oil supply is projected to decline by an average of 5.8 mb/d to 100.7 mb/d in 2026 before rebounding by 7.7 mb/d in 2027.
However, renewed attacks in the Gulf threaten to undermine the recovery, the IEA said.
A recovery in West Asian oil supplies was well under way in September, with Gulf crude oil exports approaching pre-war levels.
However, escalating attacks on regional energy infrastructure and tanker traffic threaten further gains.
The IEA added that Brent crude futures had risen by 13 per cent since the beginning of September to around US$107 per barrel.
Without a resolution to conflicts in West Asia, oil markets could face further turmoil in the coming months before an eventual surplus emerges in 2027, the IEA said.
-- BERNAMA-XINHUA