Russian Oil Supply Rises to 8.73 Million Barrels a Day in October
Key Facts
Russian oil supply rose to 8.73 million barrels a day in October, from 8.52 million in September, according to a table in the International Energy Agency’s report released on November 13. The increase came as the agency said global supply exceeded demand for the first time since the war in Iran began. It added that observed oil inventories rose by 52 million barrels during October, equivalent to 1.7 million barrels a day. That places the recovery in Russian supply within a broader shift in the market balance, as barrels returned to inventories after a period of tight supply. The agency said the market is heading for a surplus in the fourth quarter, with a larger inventory build expected in 2027.
The agency’s revised supply outlook reflects the scale of the change in market calculations during the final quarter of the year. It raised its estimates for fourth-quarter 2026 supply by 3.3 million barrels a day and expects the global market to return to surplus during the same period. It expects a larger inventory build in 2027, extending the impact of expanding supply into next year. In its previous report, the agency recorded a 2.5 million-barrel-a-day month-on-month increase in global supply, to 102.3 million barrels a day in September, driven by Gulf producers. The shift from that figure to the revised fourth-quarter outlook points to a rapid change in supply, as Gulf exports resume a role in increasing available barrels.
On the demand side, the agency forecast that global oil consumption would fall by 2.7 million barrels a day in 2026, to an average of 102.3 million barrels a day, before rising by 2 million barrels a day in 2027. The agency’s estimate means expected supply growth and declining demand are moving in the same direction this year, explaining its forecast that a surplus will return in the fourth quarter. The expected increase in demand in 2027 comes alongside a forecast for a larger inventory build, according to the report. These estimates remain tied to the agency’s supply and demand outlook, while the recovery in exports and developments in the war in Iran add factors affecting the market’s trajectory. The report distinguished between plentiful crude and concerns about refined products, noting that diesel is the main source of concern in the products market.
North Sea crude prices fell 32% from a peak of $136 a barrel in early October to $93 at the time the report was prepared in November, according to the agency. The report linked the decline to a recovery in Gulf exports and an easing of market tightness, as expanding supply helped shift the market balance toward surplus. By contrast, the U.S. Energy Information Administration said the average spot price of Brent was $124 a barrel in October, up $10 from September and the highest since July 2022, when the inflation-adjusted average was $127. These figures reflect different time frames: the U.S. agency’s October average, compared with the North Sea crude price when the IEA report was prepared in November. The comparison places the decline from October’s peak in the broader context of price swings during the month and recovering supply.
The Energy Information Administration expects Brent prices to fall below $90 a barrel in the second quarter of 2027, as global inventories build at a rate of 3.5 million barrels a day in the first half of the year. The International Energy Agency, meanwhile, sees global demand rising by 2 million barrels a day in 2027 after its expected decline in 2026, alongside a larger inventory build. In refining, global refinery runs fell by 1.3 million barrels a day month on month to 81.3 million in October, a seasonal low, according to the agency. It expects runs to rebound to 84.7 million barrels a day in December. The current weakness in refinery runs and the expected recovery at year-end add another dimension to the market picture, which combines rising inventories with continued tightness in some products, particularly diesel.