Crude Oil Price Movements
In May, the OPEC Reference Basket (ORB) value rose by $5.49/b, m-o-m, to average $114.55/b. The
ICE Brent front-month contract rose in May by $1.25/b, m-o-m, to average $103.71/b, while the NYMEX WTI
front-month contract dropped by $0.16/b, m-o-m, to average $98.51/b. The GME Oman front-month contract dropped by $1.81/b, m-o-m, to $102.10/b. The Brent–WTI futures spread widened by $1.41/b, m-o-m, to average at a premium of $5.20/b in May. The forward curves for key crude futures benchmarks remained steeply backwardated throughout May. Hedge funds and other money managers cut their long positions in both Brent and WTI futures contracts in May, reflecting expectations of easing tensions in the Middle East.
World Economy
The global economic growth forecasts for 2026 and 2027 remain unchanged at a healthy 3.1% and 3.2%, respectively. The US economic growth forecasts remain unchanged at 2.2% for 2026 and at 2.0% for 2027. In the Eurozone, the 2026 economic growth forecast is revised slightly down to 1.0% but remains at 1.2% for 2027. Japan’s economic growth forecasts remain at 0.8% for 2026 and 0.9% for 2027. The economic growth forecasts for China remain at 4.6% for 2026 and 4.5% for 2027. India’s economic growth forecast remains at 6.6% for 2026 and 6.5% for 2027. Brazil’s economic growth forecasts remain at 2.0% for 2026 and 2.2% for 2027. Russia’s economic growth forecasts remain at 1.3% for 2026 and 1.5% for 2027.
World Oil Demand
Global oil demand is forecast to grow by a healthy 1.0 mb/d in 2026, y-o-y. The OECD is forecast to grow by about 0.1 mb/d, while the non-OECD is forecast to grow by about 0.9 mb/d. Global oil demand in 2027 is forecast to grow by about 1.7 mb/d, y-o-y, following an upward revision of about 0.2 mb/d from last month’s assessment. The OECD is forecast to grow by 0.2 mb/d, while the non-OECD is forecast to grow by about 1.5 mb/d.
World Oil Supply
Non-DoC liquids production (i.e., liquids production from countries not participating in the Declaration of Cooperation) is forecast to grow by about 0.6 mb/d, y-o-y, in 2026, unchanged from last month’s assessment. The main drivers of liquids production growth are expected to be Brazil, the US, Canada, and Argentina. In 2027, non-DoC liquids production is forecast to grow by about 0.6 mb/d, also unchanged from last month’s assessment. The growth will mainly be driven by Qatar, Brazil, Canada, and Argentina. Natural gas liquids\ (NGLs) and non-conventional liquids from countries participating in the DoC are forecast to increase by about 0.1 mb/d, y-o-y, to average 8.8 mb/d in 2026. Additional growth of about 0.1 mb/d, y-o-y, is forecast for 2027, to average about 8.9 mb/d. In May, crude oil production by countries participating in the DoC decreased by 0.19 mb/d, m-o-m, to average about 33.13 mb/d, according to available secondary sources.
Product Markets and Refining Operations
Refining margins continued to trend downward on the US Gulf Coast (USGC) and, more sharply, in Singapore. Easing product tightness in both trading hubs pressured middle distillates and naphtha. A post-maintenance rebound in US refinery runs added to the weakness, despite strength in gasoline and residual fuel. In Singapore, margins corrected downward following the previous month’s increase, amid weak steam cracking margins and stronger regional middle distillate supply. In contrast, Rotterdam margins rose amid unplanned refinery outages and renewed supply risks.
Tanker Market
In May, dirty tanker spot freight rates remained elevated, although down from record highs registered in March. Increased long-haul demand supported VLCC spot freight rates, offset by tankers repositioning to active markets, which eased some of the upward pressure on rates. On the West Africa-to-East route, VLCC spot freight rates declined 4%, m-o-m, but remained 121% higher than in the same month last year. The Suezmax market experienced a similar dynamic, despite US Gulf crude exports remaining near record levels amid ongoing SPR releases. On the USGC-to-Europe route, spot freight rates fell 22%, m-o-m, but were still 130% higher, y-o-y. Aframax spot freight rates experienced the strongest drop but remained at the upper end of the five-year range. Aframax rates on the Mediterranean-to-Northwest Europe route fell by 51% m-o-m, as prompt buying eased from high levels in the previous month. Clean tanker spot freight rates remained elevated east of Suez on strong Asian demand, but declined west of Suez on reduced prompt buying. Clean spot freight rates on the Middle East-to-East route were up by 9%, m-o-m, while rates around the Mediterranean fell by
32%, m-o-m.
Crude and Refined Product Trade
In May, US crude imports remained steady, m-o-m, averaging 5.7 mb/d, while crude exports averaged
5.2 mb/d, broadly in line with the previous month. US product exports averaged 7.8 mb/d for the third month in a row. In April, OECD Europe crude imports slipped to an average of 7.7 mb/d. Product imports into the region stood at 2.1 mb/d, while product exports moved to the top of the five-year range, averaging 2.6 mb/ amid higher flows to the US. In Japan, crude imports fell to 853 tb/d in April. Product imports into Japan averaged 679 tb/d amid declines in LPG, kerosene and fuel oil, while product exports fell for the third consecutive month to average 291 tb/d as all major products slumped. China’s crude oil imports in April fell to an average of 9.4 mb/d amid reduced refinery runs. Product imports dropped to 1.2 mb/d amid lower LPG and fuel oil inflows. China’s product exports fell to 819 tb/d, following a government effort to limit product exports. In India, crude imports recovered in April to stand close to the five-year range at 4.9 mb/d. Product imports into India continued to decline, averaging 647 tb/d, amid a drop in fuel oil and naphtha. India’s product exports averaged 895 tb/d, with declines registered across all major products.
Commercial Stock Movements
Preliminary April 2026 data show that OECD commercial oil inventories decreased by 48.4 mb, m-o-m, to stand at 2,748 mb. At this level, OECD commercial stocks were 6.9 mb lower, y-o-y, 53.7 mb below the latest five-year average, and 179.5 mb below the 2015–2019 average. Within the components, crude stocks increased by 4.2 mb, while product stocks decreased by 52.7 mb, m-o-m. OECD commercial crude oil stocks stood at 1,348 mb. This was 2.0 mb lower, y-o-y, 31.6 mb below the latest five-year average, and 124.5 mb below the 2015–2019 average. OECD total product stocks stood at 1,399 mb in April. This was 4.9 mb lower, y-o-y, 22.1 mb below the latest five-year average, and 55.1 mb below the 2015–2019 average. In terms of days of forward cover, OECD commercial stocks fell by 1.6 days, m-o-m, in April, to 60.1 days. This was 0.2 days higher, y-o-y, but 1.3 days below the latest five-year average and 2.1 days below the 2015–2019 average.
Balance of Supply and Demand
The demand for DoC crude (i.e., crude from countries participating in the DoC) in 2026 is revised down from the previous month’s assessment by 0.2 mb/d, to 42.5 mb/d, which is about 0.2 mb/d higher than in 2025. The demand for DoC crude in 2027 remains unchanged from the previous month’s assessment at 43.5 mb/d, which is about 1.0 mb/d above the 2026 forecast.