IEA demand revisions align with declining stocks observed by Kpler

The IEA revised its May 2025 OMR historical global oil demand upwards due to non-OECD underestimations, turning past surpluses into deficits and tightening historical balances, aligning with crude inventories draws displayed by Kpler over the last years.

The oil industry has reacted with notable attention this week to the International Energy Agency's (IEA) May 2025 Oil Market Report (OMR), which featured revised historical demand figures, particularly from non-OECD countries such as Egypt and Nigeria.

The IEA's May 2025 OMR incorporated substantial upward adjustments to past global crude demand: +0.26 Mbd for 2022, +0.33 Mbd for 2023, and +0.35 Mbd for 2024. Collectively, these revisions added hundreds of millions of barrels to the demand side of the global oil equation. This shift transformed previously reported surpluses for these years into deficits, bringing the IEA's data into closer alignment with inventory levels observed by Kpler and effectively addressing the "missing barrels" issue for that period.

While these revisions have resulted in a decrease in the IEA's 'global oil balance' for 2022 (now at -0.09 Mbd), 2023 (at -0.04 Mbd), and 2024 (at -0.14 Mbd), the IEA's ‘total observed stock changes’ for these same periods have remained unchanged and essentially flat. This suggests consistent onshore and offshore inventory levels, which contrasts with Kpler's data indicating a continuous decline in global onshore and offshore crude stocks throughout 2022, 2023, and 2024, amidst renewed stringent OPEC+ supply management and recovering demand in the post-COVID era.

Global year-ending crude onshore stocks including oil on water, Mbbls

Source: Kpler

The IEA's earlier underestimation of demand in nations like Egypt and Nigeria contributed to its overall historical global oil demand figures being lower than more recent calculations show. Consequently, this revision has also led to tighter forward-looking market balances.

Nevertheless, market balances are anticipated to lengthen considerably after the summer season. This outlook is based on an accelerated unwinding of OPEC+ production cuts, combined with robust output from the Americas—notably Canada, Brazil, and Guyana (expected later this year)—and a slowdown in the growth of global crude demand. Current expectations are for the global crude and condensate balance to reach a peak surplus of +2.8 Mbd in October. This would be equivalent to an increase in global stocks of approximately 90 Mbbls in October alone, a scenario that is likely to place increasing downward pressure on crude prices during that time.

Global crude and condensate balance, Mbd

Source: Kpler

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