5 Big Energy Stories - 7.10.2026: Risk Premium? What Risk Premium?
World oil demand set for first annual decline since 2020, IEA says - And just like that, the clowns at the International Energy Agency are back to predicting peak demand. Ok, it isn’t exactly that. The agency projects a decline in 2026 only, and only due to the extended closing of the Strait of Hormuz, which dramatically impacted supply and forced countries like China to decrease their imports. But you have to know Fatih Birol is licking his lips and praying for some excuse to go back to the peak demand theory in a future monthly report.
Key Excerpt:
Global oil demand is set to decline for the first time since 2020 as the Iran war wreaked havoc with production and exports in the Middle East, the International Energy Agency (IEA) said Friday.
World oil demand is set to decline by 1 million b/d year-on-year in 2026, which would mark its first annual decrease since the height of the Covid-19 pandemic in 2020, the IEA said in its latest oil market report.
This year’s contraction is “highly skewed in both product and regional terms,” as the closure of the Strait of Hormuz — the vital shipping route for oil and gas — disrupted exports through the Persian gulf, the agency noted.
A recovery is underway, the researchers added, though they warned renewed escalation in the conflict could complicate matters and further cloud the outlook.
The IEA’s forecast rests on the assumption of a ceasefire and the gradual reopening of Hormuz, an outcome that looks increasingly uncertain as the U.S. and Iran traded hostilities this week. A number of ships came under attack and traffic through the Strait has once again slowed to a trickle.
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Oil Futures Settle Lower As Market Hopes for New Talks - Like me, readers may be wondering why oil prices fell on Thursday despite the renewed hostilities across the Middle East. It all seems so counterintuitive, doesn’t it? One analyst quoted by the Wall Street Journal says traders were trading on hope and not much else. Wild.
