17.4M Barrel Crude Build Weighs as Hormuz Risks Persist

Oil prices are under pressure from a weakening demand outlook, even as supply risks from the Middle East persist. The International Energy Agency forecasts a 1.6 million barrel per day contraction in global oil demand in 2026, a sharp revision from its earlier view. OPEC also cut its demand growth estimate to 580,000 bpd. On the supply side, the IEA projects a 4.3 million bpd drop in global oil supply this year, driven by disruptions in the Hormuz Strait.

The physical market remains unusually opaque. Tanker movements of Saudi crude along the Red Sea are moving without AIS tracking. Saudi Arabia has increased shipments through the Suez Canal and Egypt's SUMED pipeline. With vessels going dark, estimates of actual Middle Eastern supply are wide, complicating assessments for both OPEC and the IEA.

US data added a bearish weight. Commercial crude stocks rose by 17.4 million barrels to 424.4 million barrels in the week through August 7, the largest weekly increase since January 2023. Exports fell while imports rose, the Energy Information Administration said.

Natural gas supplies in the US are ample. The EIA expects record high average production of 122.5 Bcf/d in 2026, with LNG exports averaging 17.4 Bcf/d, up from 15.1 Bcf/d in 2025. Third-quarter LNG exports are seen around 16.5 Bcf/d, with continued disruptions in the Hormuz Strait keeping global gas markets tight.

Natural gas futures traded around $2.79 on the two-hour chart after bouncing from support in the $2.62-$2.66 zone. Price sits above the 50-period EMA at $2.76 and the 100-period EMA at $2.75, suggesting buyers are maintaining pressure. The prior descending trendline has been broken, an improvement in market structure, traders said.