Global oil demand continues to grow at a robust pace, with the IEA estimating growth of 1.3-1.5 million barrels per day in 2026. Total world oil consumption is running at approximately 104 million bpd, exceeding pre-pandemic peaks by approximately 4 million bpd.
Asian demand growth is the primary driver, with China, India, and Southeast Asia accounting for over 800,000 bpd of incremental consumption. Indian oil demand, in particular, has been strong, growing at 5-6% annually as the country's economy expands and vehicle ownership increases.
Air travel demand recovery continues to push jet fuel consumption higher. Global jet fuel demand is now at 98% of pre-pandemic levels, with international travel recovered strongly. Jet fuel accounts for approximately 7-8% of total oil demand.
The US economy's resilience has supported gasoline and diesel demand, though the shift to EVs is beginning to show in flat-to-declining US gasoline consumption. Diesel demand remains robust, supported by trucking, construction, and industrial activity.
On a supply-demand balance basis, the oil market is estimated to be in a modest deficit of 500,000-700,000 bpd in H2 2026, requiring ongoing inventory draws and supporting prices at current elevated levels.
Demand growth exceeding supply growth creates a bullish price environment. Fuel and feedstock buyers should implement programs that lock in prices within the $90-100/bbl range using collars or swaps, as the structural deficit supports the current price level.