BAKU, Azerbaijan, August 12. OPEC expects oil
demand in the Middle East to decline in 2026 and recover in
2027.
According to OPEC's report, oil demand in the Middle East in May
2026 fell by 180,000 barrels per day year-over-year, following a
decline of approximately 40,000 barrels per day in April.
The report notes that the decline in demand for fuel oil,
petrochemical feedstocks, and transportation fuels more than offset
the increase in direct crude oil consumption.
“In particular, demand for fuel oil in May fell by approximately
100,000 barrels per day year-over-year. In April, by contrast,
demand for this fuel rose by about 150,000 barrels per day. Demand
for naphtha and jet/kerosene fuel fell by about 70,000 barrels per
day for each fuel type. Consumption of liquefied petroleum gas,
gasoline, and diesel fuel decreased by approximately 20,000 barrels
per day for each type.
At the same time, demand for the “other petroleum products”
category, including the direct combustion of crude oil, increased
by 110,000 barrels per day. The largest increase in demand in this
category was in Saudi Arabia,” OPEC reports.
In addition, it is noted that in the third quarter of 2026, GDP
growth in the region’s largest consumer countries is expected to
slow, but growth will be supported by the non-oil sector of the
economy.
"OPEC expects economic activity in the region to gradually
stabilize and improve by the end of the year. Accordingly, oil
demand in the Middle East is projected to decline by approximately
50,000 barrels per day year-over-year in the third quarter.
In 2026, the region’s economy is expected to remain resilient
thanks to the non-oil sector, stable private consumption, and
slowing inflation.
The latest Purchasing Managers’ Index (PMI) figures for the
region’s largest economies also point to continued activity in the
non-oil sector," the OPEC report states.
The report highlights that in Saudi Arabia, the non-oil sector
PMI rose to 53 points in June from 52 points in May and 51.5 points
in April.
"In the UAE, the non-oil PMI index declined slightly in June but
remained in expansionary territory, standing at 51 points compared
to 52.3 points in May. Annual inflation in Saudi Arabia in June
2026 remained at 1.8%, unchanged from May and in line with market
expectations. Overall, oil demand in the region in 2026 is expected
to decline by approximately 50,000 barrels per day on an annualized
basis, averaging 8.8 million barrels per day.
In terms of petroleum products, the growth in demand in 2026
will be driven primarily by fuel oil. Some growth is also expected
for diesel fuel.
According to the forecast, gasoline demand will decline
slightly. In the “other petroleum products” category, demand is
expected to decline for LPG, naphtha, and jet/kerosene fuel," OPEC
reports.
Meanwhile, it is noted that in 2027, the region’s economy is
expected to recover, and economic activity will return to full
growth against the backdrop of a resilient non-oil sector and
strong domestic demand.
"The economy will also be supported by infrastructure spending,
a stable labor market, and slowing inflation. Growth in
international air travel and automotive mobility is expected to
underpin oil demand.
According to OPEC’s forecast, the region’s petrochemical
industry will continue to grow in 2027.
“As a result, oil demand in the Middle East is expected to
recover in 2027 and grow by approximately 0.3 million barrels per
day on an annual basis, reaching an average of 9.1 million barrels
per day,” the OPEC report states.
