According to the OPEC Monthly Oil Market Report, global oil demand is projected to increase by 1.4 million barrels per day in 2026, driven largely by consumption in non-OECD economies (Organisation for Economic Co-operation and Development), even as refining constraints and regional demand imbalances support higher product margins across major markets.
The growth is expected to be led by China, India and Other Asia, underscoring the continued dominance of emerging markets in shaping global energy consumption. Quarterly demand is forecast to rise by 1.5 mb/d year-on-year in the first quarter of 2026, slow to 0.9 mb/d in the second quarter, before recovering to 1.6 mb/d in both the third and fourth quarters.
The mid-year slowdown reflects temporary softness linked to geopolitical developments in the Middle East. That weakness is expected to be offset later in the year as demand strengthens in transport and industrial segments.
Transport fuels drive incremental gains
Transportation fuels remain a key source of growth across the forecast period. Gasoline demand is expected to expand by 0.2 mb/d year-on-year in the second quarter, rising to 0.6 mb/d in both the third and fourth quarters. Jet and kerosene demand is forecast to grow modestly by 0.1 mb/d in the second quarter before accelerating to 0.4 mb/d and 0.5 mb/d in the third and fourth quarters respectively, reflecting stronger aviation activity.
Diesel demand is projected to rise more gradually, increasing by 0.1 mb/d in the second and third quarters and 0.2 mb/d in the fourth quarter. For the full year, gasoline demand is set to rise by 0.4 mb/d, jet and kerosene by 0.3 mb/d, and diesel by 0.2 mb/d.
Regional divergence shapes outlook
Within advanced economies, demand trends remain mixed. In the OECD Americas, oil demand is forecast to grow by around 60,000 barrels per day in the second quarter, accelerate to 0.2 mb/d in the third quarter, and increase by 90,000 b/d in the fourth quarter. OECD Europe is expected to remain flat in the second quarter before posting modest gains in the second half of the year. OECD Asia Pacific is set to soften in the second quarter before returning to marginal growth later in the year.
The OECD outlook contrasts with stronger momentum in non-OECD regions, which continue to account for the bulk of global demand growth. The OECD is represented by the Organisation for Economic Co-operation and Development, which groups major advanced economies.
China remains the single largest contributor to incremental demand, with consumption expected to rise by around 0.2 mb/d in each of the remaining quarters of 2026, supported by mobility and industrial activity. India is projected to add 0.2 mb/d in the second and third quarters, increasing to 0.3 mb/d in the fourth quarter.
Other Asia is forecast to contribute an additional 0.1 mb/d in the second quarter, rising to 0.3 mb/d in the third and 0.4 mb/d in the fourth quarter. Additional growth is also expected across Africa, Latin America and the Middle East, reinforcing broad-based expansion in developing markets.
The global picture is anchored by non-OECD strength, even as electric vehicle penetration and trade uncertainty between major economies continue to weigh on the pace of expansion.
Refining squeeze tightens product markets
On the supply side, refining conditions have tightened sharply.
Global refinery processing rates fell to 77.1 million barrels per day in March, marking a decline of 5.0 mb/d from the previous month and 4.1 mb/d lower year-on-year. The drop represents the steepest monthly contraction since April 2020.
The decline was driven by significant run cuts in the East of Suez region, alongside seasonal maintenance peaks typically seen in April. Overall, global crude intake is estimated to be 4.8 mb/d below normal levels, with roughly two-thirds of the shortfall attributed to geopolitical disruptions.
Refining operations across the industry are monitored closely by the Organization of the Petroleum Exporting Countries, which tracks global supply-demand balances and market conditions.
The reduction in throughput has tightened product availability, contributing to stronger refining margins and wider crack spreads, particularly in middle distillates.
In contrast, refiners in the US have increased activity, with intake rising by 380,000 b/d in March as plants return from maintenance and respond to improved margins.
Outlook: seasonal demand meets constrained supply
Looking ahead, seasonal demand growth is expected to reinforce already tight product markets. Rising mobility during the summer driving season is likely to lift gasoline consumption, while aviation demand continues to recover.
Lower refinery runs combined with stronger transport fuel consumption suggest sustained support for refining margins through the remainder of 2026, with potential upside if supply constraints persist into peak demand months.
