Crude Oil Price Movements
In July, the OPEC Reference Basket (ORB) value dropped by $6.76/b, m-o-m, to average $82.99/b. The ICE Brent front-month dropped by $0.46/b in July, m-o-m, to average $83.97/b, while the NYMEX WTI front- month contract dropped by $2.57/b to average $79.22/b. The GME Oman front-month contract dropped by $1.73/b, m-o-m, to average $77.52/b. The Brent–WTI futures spread widened by $2.11/b, m-o-m, to an average premium of $4.75/b in July. The forward curves of ICE Brent and GME Oman strengthened in July. Geopolitical risks and concerns about prompt supply availability supported prompt-month contracts, while oil market fundamentals remained robust. The NYMEX WTI structure flattened slightly but remained in firm backwardation as US crude stocks continued to decline in July. Hedge funds and other money managers raised their speculative net long positions in July.
World Economy
The global economic growth forecast for 2026 is revised down slightly to 3%, while the forecast for 2027 remains unchanged at 3.2%. The US economic growth forecast remains unchanged at 2.2% for 2026 and 2% for 2027. In the Eurozone, the 2026 economic growth forecast is revised down slightly to 0.8% and to 1% for 2027. Japan’s economic growth forecasts are revised down slightly to 0.7% and 0.8% for 2026 and 2027, respectively. The economic growth forecasts for China remain unchanged at 4.6% for 2026 and 4.5% for 2027. India’s economic growth forecast remains unchanged at 6.6% for 2026 and 6.5% for 2027. Brazil’s economic growth forecasts remain unchanged at 2% for 2026 and 2.2% for 2027. Russia’s economic growth forecast for 2026 is revised down slightly to 1.1% and remains unchanged at 1.5% for 2027.
World Oil Demand
Global oil demand is forecast to grow by 0.6 mb/d in 2026, y-o-y, following a slight downward revision from last month’s assessment. The OECD is forecast to slightly decline by about 40 tb/d, while the non-OECD is forecast to grow by about 0.6 mb/d. Global oil demand in 2027 is forecast to grow by about 2.2 mb/d, y-o-y, following an upward revision from last month’s assessment. The OECD is forecast to grow by about 0.3 mb/d, while the non-OECD is forecast to grow by about 1.8 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. This growth will mainly be driven by Qatar, Canada, Brazil, 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 July, crude oil production by countries participating in the DoC increased by 1.42 mb/d, m-o-m, to average about 37.66 mb/d, according to available secondary sources.
Product Markets and Refining Operations
Refining margins extended their upward trend across all three main trading hubs, driven by a distillate-led rally as refinery outages, a diesel export ban in Eastern Europe and geopolitical developments tightened global middle distillate balances. On the US Gulf Coast (USGC), refining margins reached their highest level since October 2022, while Rotterdam posted the largest m-o-m gain among the three hubs, as European diesel and gasoline stocks remained low. In Singapore, margins also strengthened, supported by constrained Asian refinery throughputs and a decline in crude prices.
Tanker Market
Dirty tanker spot freight rates were mixed across vessel classes in July. VLCC rates declined on average, m-o-m, but remained at historically elevated levels amid trade flow disruptions. On the West Africa-to-East route, VLCC spot freight rates slipped 3% on average in July, m-o-m, but remained some 188% higher than in the same month last year. In contrast, Suezmax and Aframax spot freight rates showed gains across all monitored routes. On the USGC-to-Europe route, Suezmax rates rose 28%, m-o-m. Aframax rates showed the strongest average gains, supported by tightness in the US Gulf Coast and Mediterranean. On the Cross- Mediterranean route, Aframax dirty spot rates rose 60%, m-o-m. In the clean tanker market, spot freight rates showed divergent trends in July. East of Suez rates fell 13% on average, m-o-m, while West of Suez spot rates edged up by 2% on average, m-o-m, in July.
Crude and Refined Product Trade
US crude imports recovered, m-o-m, in July to average 5.7 mb/d, while crude exports continued to fall from elevated levels to average 3.5 mb/d, according to preliminary weekly data. In June, crude imports into OECD Europe are likely to have moved seasonally lower, as elevated US inflows returned to more typical levels. Meanwhile, Japan’s crude imports rebounded, returning to the five-year average of 2.1 mb/d in June, supported by a return of inflows from the Middle East. Japan’s product exports rose, supported by gains in all major products except jet fuel. China’s crude imports fell further in June to average 7.1 mb/d as refiners continued to limit runs. China’s product imports also remained constrained by reduced feedstock demand, while product exports picked up amid an easing of government restrictions. India’s crude imports declined in June, largely in line with seasonal trends and following strong inflows in the previous month, to average 4.8 mb/d. Low LPG and fuel oil imports continued to weigh on India’s product imports, while product exports rose 5% as higher exports of gasoline and fuel oil offset declines in diesel oil and naphtha.
Commercial Stock Movements
Preliminary June 2026 data shows that OECD commercial oil inventories dropped by 26.4 mb, m-o-m, to stand at 2,729 mb. At this level, OECD commercial stocks were 59.6 mb lower, y-o-y, 66.5 mb below the latest five- year average and 218.5 mb below the 2015–2019 average. Within the components, crude stocks decreased by 15.3 mb, while product stocks decreased by 11.1 mb, m-o-m. OECD commercial crude oil stocks stood at 1,296 mb. This was 33.6 mb lower, y-o-y, 54.2 mb below the latest five-year average and 169.3 mb below the 2015–2019 average. OECD total product stocks stood at 1,433 mb in June. This was 26.0 mb lower, y-o-y, 12.3 mb below the latest five-year average and 49.3 mb below the 2015–2019 average. In terms of days of forward cover, OECD commercial stocks fell by 1.0 days, m-o-m, in June, to 58.7 days. This was 1.2 days lower, y-o-y, 1.9 days below the latest five-year average and 3.0 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 last month’s assessment to 42.1 mb/d, 0.2 mb/d lower than the 2025 level. The demand for DoC crude in 2027 remains unchanged from the previous month’s assessment to stand at 43.6 mb/d, which is about 1.4 mb/d above the 2026 forecast