Recent analyses from IEA and EIA highlight evolving dynamics in the global crude oil market, driven by accelerating field decline rates and shifting inventory trends.
IEA estimates indicate that natural decline rates in conventional oil fields average 6–7% per year, meaning that maintaining the current global supply requires significant new production volumes annually. Rising upstream investment needs and higher costs to secure stable crude flows are creating long-term supply risks. Any underinvestment could lead to tighter availability, making crude strategic for refining and petrochemical feedstocks.
At the same time, EIA projections suggest that in the second half of 2025 global inventories may rise by 0.4–0.5 mb/d, slightly outpacing demand growth of around 0.7 mb/d according to IEA. Short-term effects include downward pressure on spot and futures prices, increased storage costs, and adjustments in global trade flows. However, when combined with the ongoing acceleration of field declines, the market faces a complex scenario: near-term oversupply overlays long-term supply fragility.
Temporary crude availability may ease price pressure, but fluctuating fundamentals are driving wider crack spread volatility, impacting refining margins and profitability.
Overall, the global oil market in 2025 is characterized by a delicate balance between short-term inventory dynamics and long-term supply constraints.