The U.S. Energy Information Administration has sharply revised its global oil inventory outlook, now expecting stocks to drain by 2.6 million barrels per day in 2026. That's a dramatic shift from the agency's prior forecast of just a 300,000-barrel daily decline. The revision reflects an extended Middle East conflict that's blocking the Strait of Hormuz and locking in regional production cuts.

In its latest Short-Term Energy Outlook, the EIA warned that 8.5 million barrels per day could be drawn from inventories in the second quarter alone. Six Gulf states—Iraq, Saudi Arabia, Kuwait, the UAE, Qatar and Bahrain—shut in roughly 10.5 million barrels per day of crude production in April. The U.S. blockade of Iranian ports is also pressuring Tehran's ability to export oil.

The agency assumes the Strait of Hormuz will remain closed until late May, with shipments beginning to recover in June but not reaching prewar levels until later in the year. Some Middle East oil production is expected to remain disrupted even after shipping resumes. The forecast incorporates emergency releases from strategic petroleum reserves.