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Ulviyya Poladova

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Azerbaijan’s average daily crude oil production stood at 440,000 barrels per day in July 2026, unchanged from June, AzerNEWS reports.

According to the International Energy Agency’s (IEA), geopolitical tensions and disruptions to oil supplies are having a significant impact on the balance of the global oil market.

It was noted that global oil supply is expected to decline by an average of 4.3 million barrels per day in 2026, falling to 102 million barrels per day. In 2027, global supply is projected to increase by 8.3 million barrels per day, reaching 110.3 million barrels per day.

"Global oil demand is forecast to decline by 1.6 million barrels per day in 2026, which is 510,000 barrels per day more than projected in the previous month’s report. The continued closure of the Strait of Hormuz and high fuel prices continue to put pressure on oil consumption," the report said.

The IEA expects global oil demand to increase by 2.4 million barrels per day in 2027.

According to the report, global oil production increased by 2.4 million barrels per day in July from the previous month, reaching 101.5 million barrels per day. However, this was 6.3 million barrels per day lower than in the same month last year. In the Gulf countries, 8.3 million barrels per day of production capacity remains shut in.

The IEA said that renewed military operations in July and early August, along with disruptions to maritime transportation, have made it more difficult to restore oil production. As a result, the agency cut its forecast for global oil supply in the third quarter of 2026 by 1.7 million barrels per day compared with its previous report.

"The global oil market is expected to face a deficit of 1.8 million barrels per day in the third quarter of 2026, more than twice the approximately 800,000 barrels per day deficit forecast in last month’s report," the IEA said.

Global oil inventories fell sharply by 69 million barrels in July, mainly due to a decline in seaborne oil volumes. At the end of July, observed global oil stocks had fallen below 7.9 billion barrels.

Meanwhile, significant changes were also recorded in the oil refining sector in July. Global refinery crude processing increased by 1.8 million barrels per day month-on-month, but remained approximately 5 million barrels per day below the level recorded during the same period last year.