The conflict in Iran is determining the largest Blockage in the oil market of history. This is highlighted by the latest Oil Market Report published today by International International Olive Oil Energy Agency (IEA) which predicts a contraction in the oil demand of 80,000 barrels per day due to the conflict and a decrease of 1.5 million barrels per day in the second quarter of 2026 alone, which - the report highlights - is the most marked since Covid-19 drastically reduced fuel consumption.

The document specifies that, initially, the most significant use of oil were recorded in the Middle East and Asia-Pacific region, and concerned mainly naphtha, LPG and jet fuel. However, the contraction in demand will extend due to the persistence of product scarcity and high prices.

In March 2026, global oil supply plummeted by 10.1 million barrels per day at 97 mb/d. The OPEC+ production decreased by 9.4 mb/d on a monthly, reaching 42.4 mb/d, while the offer of the countries OPEC+ fell by 770,000 barrels per day to 54.7 mb/d, with lower Qatari production being offset by increases in Brazil and the United States.

The report explains that global crude oil processing continues to be affected by disruptions in the supply of raw materials and the damage to the infrastructure they put under pressure global markets for petroleum products. In April, the refineries in the Middle East and Asia, already limited in the supply of raw materials, have reduced the processing of about six MB/d, bringing it to 77.2 MB/d. Currently Global crude oil processing is expected to decline in average of 1 MB/d in 2026, standing at 82.9 MB/d.

Stocks global oil prices fell by 85 million barrels in March, with reserves outside the Persian Gulf falling by as much as 205 million barrels (-6.6 million barrels per day) due to the blocking flows through the Strait of Hormuz. At the same time time, with limited outlets after the effective closure of the Strait, the stocks of crude oil and petroleum products on ships in The Middle East has increased by 100 million barrels and the stocks of Onshore crude oil in the region grew by 20 million barrels. The report notes that, in the meantime, China has added 40 million barrels of crude oil to its own stocks.

In addition, the document points out that in March 2026, the prices of the recorded the largest monthly increase ever, with Benchmark spot oil prices and their spreads which have skyrocketed, outpacing the performance of the markets futures, while refineries scrambled to replace cargoes from the Middle East. The document specifies that at the time of publication of the report, the Dated Brent was traded at around $130 per barrel, or $60 per barrel more than pre-conflict levels.

IEA report finds that the recovery of transport across the Strait of Hormuz remains the most to ease the pressure on energy supplies, on prices and the global economy. At the beginning of April, the maritime expeditions across the Strait remained strongly with cargoes of crude oil, natural gas and refined products equal to an average of about 3.8 million barrels per day compared to to over 20 million barrels per day in February, before the crisis. At the same time, exports through alternative routes - in particular from the west coast of Saudi Arabia and Fujairah, on the east coast of the United Arab Emirates, as well as through the ITP pipeline connecting Iraq to Ceyhan, Turkey - had increased to 7.2 million barrels per day compared to less than four million barrels a day before the war. In the overall, the reduction in oil exports exceeds 13 million barrels per day, resulting in a decrease in and damage to energy infrastructure in the region which have led to cumulative supply losses above 360 million barrels in March and 440 million barrels scheduled for April.

The report explains that both on the consumption side and on the of production is being drawn on oil stocks to mitigate the immediate impact of disruptions supplies. In March, global oil inventories were decreased by 85 million barrels despite a build-up of inventories both onshore and offshore in the Middle East and further increases of stocks in China. The largest decline was recorded for the oil at sea following the almost total interruption of the Gulf producers dependent on the Strait of Hormuz. Crude oil inventories in importing countries in Asia decreased by 31 million barrels, and further Declines in April.

The paper notes that where oil stocks are not If you manage to close the gap, demand has taken a hit. In particular, Asian petrochemical producers have reduced their production levels due to the depletion of raw materials. Households and businesses using LPG have also been affected, while flight cancellations in the Middle East, in parts of Asia and Europe have led to a sharp decline of jet fuel consumption. In addition, an increasing number of countries have implemented policies to reduce demand, while others have taken steps to protect consumers from the full impact of the increase in fuel prices. Overall, it is estimated that global oil demand contracted by 800,000 in March barrels per day and which will decrease by 2.3 million barrels per day in April barrels per day. Currently, global demand for oil will fall by an average of 80,000 barrels per day in 2014. 2026, compared to expected growth of 730,000 barrels per day in the IEA report last month.