OPEC Secretary General Haitham Al Ghais has pushed back against forecasts from the International Energy Agency (IEA), which claimed that the global oil market is headed toward a major supply glut, arguing that demand remains strong as the Strait of Hormuz begins reopening following months of disruption caused by the Iran conflict.
In an interview with CNBC on Thursday, al-Ghais criticized the IEA's latest outlook, which projected that oil supply could outpace demand by a wide margin in 2027 if the conflict between Iran and the United States is fully resolved and Middle Eastern exports return to normal levels.
The Paris-based agency said in a report on Wednesday that global oil supplies could increase by 8 million barrels per day while demand rises by only 2 million barrels per day next year, potentially creating a significant surplus that could weigh on prices. Al-Ghais pushed back against that assessment, questioning the assumptions behind the forecast.
"Sometimes it's best not to make such assumptions when they are not really based on facts and figures," he told CNBC's Dan Murphy. "What does the IEA see that OPEC and the rest don't see?" he added. "[We focus] on fundamentals and not putting many ifs and buts in our forecasts, but rather focusing on actual numbers."
The OPEC chief suggested that dramatic forecasts risk creating unnecessary uncertainty in already volatile energy markets. "We're not about making a fancy headline that will be catchy. Sometimes it's best not to make such assumptions ... when they are not really based on actual facts and figures," al-Ghais said.
"Ultimately, these headlines only create more volatility." The disagreement comes as oil traders assess the implications of a breakthrough diplomatic agreement between Washington and Tehran that could reshape global energy flows in the coming months.
The United States and Iran signed a 14-point memorandum of understanding aimed at ending the war and reopen the Strait of Hormuz. The agreement commits both countries to continue negotiations over the next 60 days in pursuit of a broader deal.
The framework also includes a $300 billion reconstruction plan for Iran and calls for the removal of all U.S. sanctions on the Islamic Republic, potentially paving the way for a significant increase in Iranian oil exports.
Iran said it would guarantee the safe passage of commercial vessels through the strait without charging tolls for 60 days while discussions continue regarding its long-term administration and maritime services.
The strait handles roughly one-fifth of the world's oil trade and serves as a critical transit route for crude exports from Saudi Arabia, Iraq, the United Arab Emirates, Kuwait and Iran.
Al-Ghais welcomed the diplomatic progress but cautioned against drawing immediate conclusions about its long-term impact. "OPEC welcomes and appreciates" the efforts that led to the agreement, he said, while noting that there are still "many moving parts" that make it "premature" to predict how the situation will evolve.
The OPEC chief emphasized that recent events have underscored the strategic importance of the Strait of Hormuz not only for the cartel's members but also for the broader global economy. "I think what the last four months have really proven is just how critical that waterway is not just for OPEC producers, but for Middle Eastern producers and global energy markets," al-Ghais said.
