Iran’s Oil Output Falls to 1.86 Million Barrels a Day in October
Key Facts
The International Energy Agency estimated Iran’s crude oil production at 1.86 million barrels a day in October 2026, down from 1.94 million barrels a day in September. The decline came in a month when the agency said crude flows from the Gulf rose to 15 million barrels a day, equivalent to 82% of pre-war levels. That places the drop in Iranian production in a regional picture of a partial recovery in flows, while Iranian exports remain constrained, according to estimates by the U.S. Energy Information Administration. The production figure alone does not measure how much crude reaches markets through exports. In its November report, the agency said global oil supply exceeded demand for the first time since the war began and forecast a surplus in the fourth quarter of 2026.
Reuters shipping data show the scale of the decline in Iranian loadings during earlier periods of the year. Crude and condensate loadings ranged from 220,000 to 255,000 barrels a day in August, compared with about 740,000 barrels a day in July and about 2 million barrels a day in March. Reuters said Iran had gone about 7 weeks, through September 1, without shipping significant crude exports through the Strait of Hormuz. It reported that Iranian crude shipments had not crossed the strait to China since the blockade was reimposed on July 14. These figures provide background on loading and transport activity in earlier months, while the agency’s estimate for October production relates to the month covered by its report.
At the regional supply level, the U.S. Energy Information Administration said average Middle East crude production shut-ins were 2.5 million barrels a day in October, after peaking at 10.9 million barrels a day in May. The agency expects shut-in volumes to remain largely stable through the rest of 2026. In its report, the IEA linked higher oil prices to falling inventories and attacks on oil tankers, which disrupted flows, reduced tanker availability and pushed up rates. It also reported that Brent crude averaged $124 a barrel in October, up $10 from September. That was the highest average since July 2022, when the price reached $127 a barrel after adjusting for inflation.
By contrast, observed global oil inventories rose by 52 million barrels in October, according to the International Energy Agency, as global supply reached 105.4 million barrels a day. The agency said supply exceeded demand for the first time since the war began and forecast a market surplus in the fourth quarter. This comes alongside its forecast for global oil demand to fall by 2.7 million barrels a day in 2026 to 102.3 million barrels a day. Year on year, demand is expected to decline by an average of 4.4 million barrels a day in the second and third quarters. The agency expects demand to rise by 2 million barrels a day in 2027.
The outlook for a gradual easing of regional shut-ins depends on alternative export routes, including pipelines, overland transport and ship-to-ship transfers, according to the Energy Information Administration. The agency expects new pipeline capacity in the UAE to enter service in 2027, but it sees Iranian exports remaining constrained. Verisk Maplecroft warned in a report cited by Axios that shipping threats would persist through 2027, and said attacks increased in October. Axios also cited Goldman Sachs’ estimate that adaptation in the shipping market accounts for most of a $20-a-barrel year-on-year increase in average oil transportation costs. The risks of attacks and shipping costs remain among the factors agencies are monitoring in their supply outlooks for the period ahead.