IEA: OECD government oil inventories fall to lowest since 1990 amid Middle East supply disruptions

The International Energy Agency (IEA) has reported that government-controlled oil inventories in OECD countries have fallen to their lowest level since December 1990, following accelerated emergency stock releases in response to major supply disruptions from the Middle East conflict.

In its June 2026 Oil Market Report, the IEA stated that OECD government inventories fell by 163 million barrels (1.8 million barrels per day) over the relevant period to that multi-decade low as the pace of releases quickened. The report noted that the decline in global observed inventories accelerated in May to 143 million barrels (4.6 mb/d), lifting the average pace of stock draws since the start of the Gulf conflict to 3.8 mb/d. It added that further declines in coming months could still take global oil stocks to historic lows before the market balance shifts to surplus toward the end of the year.

Earlier data in the May 2026 Oil Market Report showed global observed oil inventories drawing by 129 million barrels in March and a further 117 million barrels in April, with on-land stocks dropping sharply amid restrictions on seaborne trade through the Strait of Hormuz. Cumulative supply losses from Gulf producers had already exceeded 1 billion barrels, with more than 14 million barrels per day shut in at points during the crisis.

Toril Bosoni, head of the IEA’s oil industry and markets division, said on June 2 that stock draws were continuing into the summer. “We’re seeing stock draws continuing into the summer, and with the possibility or the likelihood that we reach critical levels or historical low levels just ahead of the peak summer demand,” Bosoni stated, according to Reuters. Fuel demand typically peaks in the Northern Hemisphere summer.

In a July 21 statement, IEA Executive Director Fatih Birol said the agency was closely monitoring oil markets amid escalations affecting the Strait of Hormuz and energy infrastructure. He noted that around 290 million barrels of the 400 million barrels made available in the March coordinated emergency release by IEA member countries had been released, with IEA countries still holding over 1 billion barrels of government-controlled stocks. Birol emphasized there is “no room for complacency on oil security amid the escalation in hostilities and a continued drawdown of available commercial inventories.” He highlighted that markets for refined products such as diesel and gasoline remained considerably tighter than crude markets, as refinery activity and product supplies had not recovered as quickly as crude deliveries.

The July 2026 Oil Market Report indicated that global observed oil inventories rose for the first time in four months in June by 21 million barrels, driven by higher oil on water, though total OECD stocks fell a further 62 million barrels (including an estimated 44 million from government releases). Supply rebounded partially with resumed flows through the Strait, but output remained well below pre-war levels, and product markets stayed tight.

Cushioning factors cited by the IEA include alternative export routes used by Saudi Arabia and the UAE, increased supplies from the United States, Brazil, Venezuela and Kazakhstan, and sharply lower Chinese crude imports. However, officials have stressed that emergency releases are a temporary measure and that a full resolution including reopening of the Strait of Hormuz is essential to avoid further deterioration in energy security. Global oil demand is forecast to decline in 2026 before a rebound in 2027, with the market potentially moving to surplus later this year contingent on sustained supply recovery.