WASHINGTON (dpa-AFX) - Recent surge in supplies from the Middle East and the Americas are pointing to an untenable surplus of nearly 4 million barrels of oil per day in 2026, making it increasingly clear that something has to give, the International Energy Agency says.
'The global oil market may be at a tipping point as signs of a significant supply glut emerge,' says Toril Bosoni, Head of IEA's Oil Industry and Markets Division. The overall oil surplus averaged 1.9 mb/d from January through September 2025. Crude oil prices remained largely resilient, as stock builds were concentrated in areas that have less direct influence on price formation, notably crude in China and gas liquids in the United States. Crude inventory levels in key pricing hubs remained relatively low.
Observed global oil inventories built by 225 million barrels from January through August, reaching a four-year high of 7.9 billion barrels. More than one-third of the increase occurred in Chinese crude stocks, which now sit 30 percent above their 2019 level. China's substantial stockpiling this year has been underpinned by a new Energy Law, aimed at improving its energy security. With limited storage capacity available in the country's strategic petroleum reserves, oil companies are now mandated to increase oil stocks at their own commercial storage facilities, effectively positioning the private firms as long-term strategic storage partners for the government.
At the same time, stocks of natural gas liquids in the United States rose by 67 mb, significantly more than their seasonal norm as trade tensions disrupted sales to Chinese petrochemical plants. Elsewhere, markets remain much tighter. For instance, industry crude stocks in advanced economies fell by 10.4 mb over the past five months, while crude stocks in emerging and developing economies outside China rose by a meager 5.5 million barrels over the same period. Notably, oil inventories in key markets, such as the United States, remain low by historic standards and this has supported prices, Bososni said in a commentary.
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