Global fuel demand expected to fall as softer economy and policy shifts curb consumption, says IEA.
The International Energy Agency (IEA) says global oil demand is heading for its steepest quarterly decline since the Covid shock, with its outlook indicating weaker consumption in April and the second quarter as trade tensions and softer economic momentum weigh on fuel use.
An OPEC+ report, meanwhile, showed the group’s output fell by 7.9 million barrels per day in March, largely due to disruptions linked to the shutdown of the Strait of Hormuz.
Investors are now focusing on the IEA’s upcoming monthly market report for clearer signals on global supply and demand trends.
Transport demand destruction
The outlook from the International Energy Agency (IEA) is significant because oil demand is primarily driven by transport, industry, and petrochemicals. A broad-based slowdown therefore points to weakening activity beyond the energy sector itself.
The IEA’s medium-term forecast still does not anticipate an outright collapse in global oil demand. Instead, it expects demand to plateau toward the end of the decade as electric vehicle adoption, efficiency improvements, and fuel substitution in power generation gradually limit further growth.
In its Oil 2024 report, the International Energy Agency (IEA) says oil demand growth is slowing from 2.1 million barrels per day in 2023, with total global demand projected to reach around 105.6 million barrels per day by 2029 before declining slightly in 2030.
The report also notes that oil demand growth is increasingly concentrated in non-OECD Asia, particularly India and China, while consumption in OECD countries continues to decline.
The current trend is notable, according to HFI Research, as it resembles the pandemic-era collapse, when lockdowns severely restricted mobility and led to a sharp drop in oil demand.
This time, however, the drivers are different: rather than a health emergency, the slowdown reflects weaker macroeconomic conditions, policy shifts, and structural changes in energy consumption.
In practical terms, the report suggests the oil market is moving from a post-pandemic rebound into a more fragile phase, where even modest shifts in economic growth, prices, or electric vehicle adoption can significantly alter the demand outlook.
EVs to cut oil consumption: EIA
The U.S. Energy Information Administration (EIA) has said in its 2024 report that electric vehicles (EVs) will “curtail consumption” of key transport fuels, as global EV sales continue to grow strongly.
The International Energy Agency’s Global Electric Vehicle Outlook 2024 notes that EV sales could reach around 17 million in 2024, up from 14 million in 2023, with EVs accounting for nearly one in five cars sold worldwide.
Until 2023, the EV boom remained “primarily a Chinese phenomenon,” the EIA said, citing data showing that China accounted for about 60% of global EV sales, while Europe made up around 25% and the United States about 10%.
Looking ahead, the agency expects the trend to continue, with global EV sales projected to reach 40 million by 2030.
At that point, the report projects that almost “one in two new cars will be an EV.”
This growth is expected to remain strong, with nearly one in three cars on the road in China by 2030 projected to be electric, compared with almost one in five in both the United States and the European Union.
Crude futures down
WTI crude oil futures fell below $96 per barrel on Tuesday (April 14, 2026), reversing gains from the previous session as markets reacted to reports that the United States and Iran are considering further negotiations aimed at securing a longer-term ceasefire before the current two-week truce expires.
The decline reflects easing geopolitical risk premiums, with traders reassessing near-term supply disruptions and focusing on diplomatic developments in the Middle East.
President Donald Trump stated that Tehran had initiated contact with Washington, while Iranian President Masoud Pezeshkian signaled readiness to continue dialogue, provided it remains within the framework of international law and regulations.
Both sides reportedly failed to reach an agreement after 21 hours of negotiations over the weekend, after which President Trump announced a blockade on Iranian oil shipments.
