Crude Oil Price Movements
In August, the OPEC Reference Basket (ORB) value increased by $3.45/b, m-o-m, to average $86.44/b. The ICE Brent front-month contract increased by $4.11/b, m-o-m, to average $88.08/b, and the NYMEX WTI front-month contract increased by $3.23/b, m-o-m, to average $82.45/b. The GME Oman front-month contract increased by $10.36/b, m-o-m, to average $87.88/b. The Brent–WTI futures spread widened by $0.88/b, m-o-m, to average $5.63/b. The forward curves of the three major crude futures benchmarks steepened further in August. Strong demand for prompt-loading cargoes, including from Asian refiners, along with persistent supply concerns and reduced global crude supply availability, supported prompt-month prices compared to forward prices. Hedge funds and money managers turned more bullish about oil prices, increasing their combined ICE Brent and NYMEX WTI net long positions by 12% between the weeks of 28 July and 25 August. The rise in net long positions was concentrated in ICE Brent futures.
World Economy
The global economic growth forecasts remain unchanged at 3% for 2026 and 3.2% for 2027. The US economic growth forecasts remain unchanged at 2.2% for 2026 and 2% for 2027. In the Eurozone, the economic growth forecasts remain unchanged at 0.8% for 2026 and 1% for 2027. Japan’s economic growth forecasts remain unchanged at 0.7% for 2026 and 0.8% for 2027. China's economic growth forecasts remain unchanged at 4.6% for 2026 and 4.5% for 2027. India’s economic growth forecasts remain 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 forecasts remain unchanged at 1.1% for 2026, and 1.5% for 2027.
World Oil Demand
Global oil demand is forecast to grow by 0.4 mb/d in 2026, y-o-y, following a slight downward revision from last month’s assessment. The OECD demand is forecast to decline by about 0.1 mb/d, while non-OECD demand is forecast to grow by about 0.5 mb/d. Global oil demand in 2027 is forecast to grow by about 2.4 mb/d, y-o-y, following an upward revision from last month’s assessment. The OECD demand is forecast to grow by about 0.4 mb/d, while the non-OECD is forecast to grow by about 1.9 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 expected to increase by about 0.1 mb/d, y-o-y, to average 8.7 mb/d in 2026. Further growth of about 0.1 mb/d, y-o-y, is forecast for 2027, to average about 8.9 mb/d. In August, crude oil production by countries participating in the DoC increased by 0.30 mb/d, m-o-m, to average about 38.05 mb/d, according to available secondary sources.
Product Markets and Refining Operations
Refining margins showed mixed trends across the main trading hubs in August. In the US Gulf Coast (USGC), refining margins extended the previous month’s gains, supported by strong middle distillate cracks amid firm export demand and tight supplies in the Atlantic Basin. Rotterdam margins also rose, with diesel remaining the main source of strength as reduced supplies in Eastern Europe and low stocks kept the European market tight. However, in Singapore, refining margins dropped amid higher refinery throughput and rising product exports from Asia, which improved regional product availability and weighed on product cracks.
Tanker Market
Dirty tanker spot freight rates were stronger in August, led by gains in VLCC rates. Spot freight rates for VLCC rose, m-o-m, across all monitored routes, recovering from the decline seen in the previous month. On the Middle East-to-East route, VLCC spot freight rates rose by 28%, m-o-m, in August, while rates on the Middle East-to-West route jumped by 51%, m-o-m. Suezmax spot freight rates also moved higher, building on the previous month’s gain. On the USGC-to-Europe route, Suezmax rates rose by 4%, m-o-m. After a strong performance in the previous month – with gains of around 60% – Aframax rates fell back in August yet remained at elevated levels. On the Mediterranean-to-Northwest Europe route, Aframax dirty spot rates declined by 18%, m-o-m. In the clean tanker market, spot freight rates showed divergent trends in August. East of Suez rates were up by 15% on average, m-o-m, while West of Suez spot rates dropped by 5% on average, m-o-m, as rates eased in the Atlantic Basin.
Crude and Refined Product Trade
US crude imports jumped by 15%, m-o-m, in August to average 6.7 mb/d. Crude exports recovered following two months of sharp declines, to average 3.9 mb/d. US product exports set a new record high of 8 mb/d, with increased outflows of propane/propylene to Asia and distillate fuel oil to Europe and Morocco. OECD Europe crude imports are estimated to have picked up seasonally in July, supported by higher flows from the UAE, Brazil and Kazakhstan. Product exports to OECD Europe slipped but remained above the five-year average. Japan’s crude imports returned to pre-crisis levels in July, averaging 2.4 mb/d. Japan’s product exports strengthened, supported by a sharp rise in gasoil outflows. Crude imports into China increased in July to average 8.4 mb/d amid a recovery in refinery runs. Preliminary customs data for August shows a further rise in crude imports to 8.95 mb/d. China’s product imports jumped to 2 mb/d amid a surge in LPG and naphtha inflows, while product exports picked up further amid an easing of government restrictions. India’s crude imports remained strong in July, averaging 5.1 mb/d, as refinery runs stood above their five-year average for this time of year. Constrained LPG imports continued to weigh on product imports, while product outflows jumped on higher diesel oil and gasoline exports.
Commercial Stock Movements
Preliminary July 2026 data show that OECD commercial oil inventories increased by 9.8 mb, m-o-m, to stand at 2,763 mb. At this level, OECD commercial stocks were 57 mb lower, y-o-y, 47.9 mb below the latest five- year average, and 206.4 mb below the 2015–2019 average. Within the components, crude stocks increased by 5.5 mb and product stocks also rose by 4.3 mb, m-o-m. OECD commercial crude oil stocks stood at 1,313 mb. This was 29.2 mb lower, y-o-y, 35.2 mb below the latest five-year average and 149.7 mb below the 2015–2019 average. OECD total product stocks stood at 1,451 mb in July. This was 27.7 mb lower, y-o-y, 12.6 mb below the latest five-year average and 56.7 mb below the 2015–2019 average. In terms of days of forward cover, OECD commercial stocks increased in July by 0.3 days, m-o-m, to 59.3 days. This was 1 day lower, y-o-y, 1.4 days below the latest five-year average, and 3.2 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 up from last month’s assessment to 42.2 mb/d. This is 0.4 mb/d lower than the 2025 level. The demand for DoC crude in 2027 is revised up from the previous month’s assessment to 43.9 mb/d. This is about 1.6 mb/d above the 2026 forecast.