Global oil demand is projected to decline for the first time since 2020, marking a historic shift in energy markets driven by the ongoing conflict in Iran.
The International Energy Agency (IEA) warned that the war has wreaked havoc on production and exports in the Middle East, creating a complex environment that clouds the broader economic outlook.
The agency’s latest assessment highlights how geopolitical instability is translating into tangible market disruptions.
Rather than a simple supply-demand imbalance, the IEA points to a structural shift where conflict-related risks are suppressing consumption growth.
This represents a significant departure from the steady expansion seen in previous years, as traders and investors grapple with the dual pressures of physical supply constraints and demand-side uncertainty.
The implications for energy markets are profound.