Global oil stockpiles saw a significant increase in the past year, reaching levels not seen since the pandemic-stricken year of 2020. According to the International Energy Agency (IEA), this surge was driven by a combination of soaring supplies and a deceleration in demand growth. The IEA, an adviser to major economies, revealed in its monthly oil report that inventories expanded by an “extraordinary” 477 million barrels in 2025. Stock levels in OECD nations have now surpassed their five-year average for the first time in four years.
The substantial build-up in oil inventories reinforces the notion that a widely anticipated oil surplus did indeed materialise last year. However, the concentration of these stockpiles in China has somewhat masked the impact on crude prices, as they are not located in more visible storage regions. Market analysts are closely monitoring whether this glut will spread to other regions, which could significantly influence the trajectory of crude oil prices.
The IEA, based in Paris, noted that “It remains to be seen when surplus barrels finally move ashore in the Atlantic Basin.” In light of these developments, the agency has revised its forecasts for oil demand growth this year, reversing last month’s optimistic outlook. The revision reflects concerns that “economic uncertainties and higher oil prices weigh on consumption”.
Looking ahead, the IEA continues to project a substantial glut of just over 3.7 million barrels a day for 2026. If realised, this would represent a record surplus in annual average terms, potentially further impacting global oil markets and pricing.
