The International Energy Agency (IEA) said oil supply moved above demand in October for the first time since the Iran war began, while diesel stayed tight and a U.S. license authorized covered Russian diesel transactions.
Global supply reached 105.4 million barrels per day, up 2.3 million from September as Gulf exports recovered. The IEA expects the market to remain in surplus in the fourth quarter.
Oil stocks gained 52 million barrels in October, their first monthly increase since June. Oil held at sea rose by 86 million barrels, while land inventories continued to contract to a level not seen since at least 2016.
Russian crude production rose to 8.73 million barrels per day in October from 8.52 million in September, an increase of 210,000 barrels per day. The rise coincided with President Donald Trump’s Oct. 9 announcement of a diesel arrangement with Russian President Vladimir Putin. The IEA did not link the production increase to that announcement.
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued General License 135 on Oct. 9. It authorizes covered transactions involving Russian-origin diesel, including U.S. imports, until 12:01 a.m. EDT April 7, 2027. The license sets no import volume and does not establish that any shipment took place.
The IEA said attacks on Russian energy infrastructure and supply losses in the Middle East continue to constrain diesel availability. European diesel prices fell 11% from early October but remained near $180 per barrel, 77% above prewar levels. Earlier IEA findings on diesel supply constraints are summarized in EconoTimes’ September coverage.
For 2027, the agency projects supply will reach 108.1 million barrels per day, an increase of 6.6 million, while demand grows by 2 million. It warned that attacks on shipping could disrupt a sustained recovery.
